Document and Entity Information
Document and Entity Information - shares | 9 Months Ended | |
Sep. 30, 2015 | Nov. 11, 2015 | |
Document and Entity Information | ||
Entity Registrant Name | Hill International, Inc. | |
Entity Central Index Key | 1,287,808 | |
Document Type | 10-Q | |
Document Period End Date | Sep. 30, 2015 | |
Amendment Flag | false | |
Current Fiscal Year End Date | --12-31 | |
Entity Current Reporting Status | Yes | |
Entity Filer Category | Accelerated Filer | |
Entity Common Stock, Shares Outstanding | 51,559,671 | |
Document Fiscal Year Focus | 2,015 | |
Document Fiscal Period Focus | Q3 |
CONSOLIDATED BALANCE SHEETS
CONSOLIDATED BALANCE SHEETS - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Assets | ||
Cash and cash equivalents | $ 23,901 | $ 30,124 |
Cash - restricted | 4,191 | 8,851 |
Accounts receivable, less allowance for doubtful accounts of $59,282 and $60,801 | 236,824 | 195,098 |
Accounts receivable - affiliate | 8,201 | 3,993 |
Prepaid expenses and other current assets | 17,769 | 14,277 |
Income taxes receivable | 3,891 | 4,246 |
Deferred income tax assets | 6,668 | 6,575 |
Total current assets | 301,445 | 263,164 |
Property and equipment, net | 22,565 | 11,643 |
Cash - restricted, net of current portion | 739 | 7,156 |
Retainage receivable | 3,150 | 3,300 |
Acquired intangibles, net | 16,081 | 19,282 |
Goodwill | 75,212 | 80,437 |
Investments | 3,804 | 5,083 |
Deferred income tax assets | 12,496 | 13,645 |
Other assets | 14,064 | 15,899 |
Total assets | 449,556 | 419,609 |
Liabilities and Stockholders' Equity | ||
Current maturities of notes payable | 2,982 | 6,361 |
Accounts payable and accrued expenses | 103,310 | 93,637 |
Income taxes payable | 11,173 | 9,306 |
Deferred revenue | 16,194 | 19,896 |
Deferred income taxes | 2,326 | 2,456 |
Other current liabilities | 13,733 | 10,044 |
Total current liabilities | 149,718 | 141,700 |
Notes payable, net of current maturities | 140,492 | 121,875 |
Retainage payable | 2,916 | 2,448 |
Deferred income taxes | 13,419 | 15,661 |
Deferred revenue | 14,384 | 12,193 |
Other liabilities | 10,946 | 3,732 |
Total liabilities | $ 331,875 | $ 297,609 |
Commitments and contingencies | ||
Stockholders' equity: | ||
Preferred stock, $0.0001 par value; 1,000 shares authorized, none issued | ||
Common stock, $.0001 par value; 100,000 shares authorized, 58,171 shares and 56,920 shares issued at September 30, 2015 and December 31, 2014, respectively | $ 6 | $ 6 |
Additional paid-in capital | 187,731 | 179,912 |
Retained earnings (deficit) | 2,319 | (5,726) |
Accumulated other comprehensive loss | (45,694) | (32,600) |
Shareholders' equity before treasury stocks and noncontrolling interest | 144,362 | 141,592 |
Less treasury stock of 6,614 shares and 6,546 shares at September 30, 2015 and December 31, 2014, respectively, at cost | (28,665) | (28,304) |
Hill International, Inc. share of equity | 115,697 | 113,288 |
Noncontrolling interests | 1,984 | 8,712 |
Total equity | 117,681 | 122,000 |
Total liabilities and stockholders' equity | $ 449,556 | $ 419,609 |
CONSOLIDATED BALANCE SHEETS (Pa
CONSOLIDATED BALANCE SHEETS (Parenthetical) - USD ($) shares in Thousands, $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
CONSOLIDATED BALANCE SHEETS | ||
Accounts receivable, allowance for doubtful accounts (in dollars) | $ 59,282 | $ 60,801 |
Preferred stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Preferred stock, shares authorized | 1,000 | 1,000 |
Preferred stock, shares issued | 0 | 0 |
Common stock, par value (in dollars per share) | $ 0.0001 | $ 0.0001 |
Common stock, shares authorized | 100,000 | 100,000 |
Common stock, shares issued | 58,171 | 56,920 |
Treasury stock, shares | 6,614 | 6,546 |
CONSOLIDATED STATEMENTS OF OPER
CONSOLIDATED STATEMENTS OF OPERATIONS - USD ($) shares in Thousands, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
Consulting fee revenue | $ 158,579 | $ 145,324 | $ 469,458 | $ 427,088 |
Reimbursable expenses | 20,356 | 16,167 | 61,393 | 44,055 |
Total revenue | 178,935 | 161,491 | 530,851 | 471,143 |
Cost of services | 89,345 | 82,675 | 268,174 | 244,511 |
Reimbursable expenses | 20,356 | 16,167 | 61,393 | 44,055 |
Total direct expenses | 109,701 | 98,842 | 329,567 | 288,566 |
Gross profit | 69,234 | 62,649 | 201,284 | 182,577 |
Selling, general and administrative expenses | 57,527 | 51,352 | 173,101 | 151,677 |
Equity in losses of affiliate | 14 | 231 | ||
Operating profit | 11,693 | 11,297 | 27,952 | 30,900 |
Interest expense and related financing fees, net | 4,147 | 16,112 | 11,252 | 26,834 |
Earnings (loss) before income taxes | 7,546 | (4,815) | 16,700 | 4,066 |
Income tax expense | 4,210 | 3,800 | 7,980 | 5,117 |
Net earnings (loss) | 3,336 | (8,615) | 8,720 | (1,051) |
Less: net earnings - noncontrolling interests | 388 | 351 | 675 | 1,089 |
Net earnings (loss) attributable to Hill International, Inc | $ 2,948 | $ (8,966) | $ 8,045 | $ (2,140) |
Basic earnings (loss) per common share - Hill International, Inc. | $ 0.06 | $ (0.19) | $ 0.16 | $ (0.05) |
Basic weighted average common shares outstanding (in shares) | 51,119 | 46,606 | 50,661 | 42,348 |
Diluted earnings (loss) per common share - Hill International, Inc. | $ 0.06 | $ (0.19) | $ 0.16 | $ (0.05) |
Diluted weighted average common shares outstanding (in shares) | 51,803 | 46,606 | 51,274 | 42,348 |
CONSOLIDATED STATEMENTS OF COMP
CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS | ||||
Consolidated net earnings (loss) | $ 3,336 | $ (8,615) | $ 8,720 | $ (1,051) |
Foreign currency translation adjustment, net of tax | (8,630) | (2,759) | (15,910) | (210) |
Other, net | (78) | (238) | (213) | 184 |
Comprehensive loss | (5,372) | (11,612) | (7,403) | (1,077) |
Comprehensive (loss) earnings attributable to noncontrolling interests | (2,992) | (598) | (6,728) | 327 |
Comprehensive loss attributable to Hill International, Inc. | $ (2,380) | $ (11,014) | $ (675) | $ (1,404) |
CONSOLIDATED STATEMENTS OF CASH
CONSOLIDATED STATEMENTS OF CASH FLOWS - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Cash flows from operating activities: | ||
Net earnings (loss) | $ 8,720 | $ (1,051) |
Adjustments to reconcile net earnings to net cash used in operating activities: | ||
Depreciation and amortization | 8,286 | 7,276 |
Provision for bad debts | 2,540 | 1,501 |
Interest accretion on term loan | 15,526 | |
Deferred tax expense | (1,585) | (2,623) |
Share based compensation | 2,360 | 2,712 |
Changes in operating assets and liabilities, net: | ||
Restricted cash | 10,658 | 3,716 |
Accounts receivable | (57,690) | (15,779) |
Accounts receivable - affiliate | (2,830) | (1,648) |
Prepaid expenses and other current assets | (4,556) | 2,381 |
Income taxes receivable | 25 | 589 |
Retainage receivable | 150 | (1,132) |
Other assets | 2,342 | 1,065 |
Accounts payable and accrued expenses | 15,194 | (3,524) |
Income taxes payable | 1,455 | (2,603) |
Deferred revenue | 589 | (7,610) |
Other current liabilities | 7,398 | (2,711) |
Retainage payable | 474 | 1,166 |
Other liabilities | 2,878 | (3,599) |
Net cash used in operating activities | (3,592) | (6,348) |
Cash flows from investing activities: | ||
Purchase of business, net of cash acquired | (4,384) | (2,393) |
Payments for purchase of property and equipment | (11,447) | |
Net cash used in investing activities | (15,831) | (2,393) |
Cash flows from financing activities: | ||
Due to bank | (2) | |
Net borrowings on revolving loans | 14,252 | (14,793) |
Proceeds from Philadelphia Industrial Development Corporation loan | 750 | |
Payments on Philadelphia Industrial Development Corporation loan | (27) | |
Net Proceeds from secondary public offering of common stock | 38,078 | |
Net proceeds from new term loan and revolving credit facilities | 120,000 | |
Payoff and termination of term loan | (100,000) | |
Payoff and termination of revolving credit facility | (25,500) | |
Payments of financing fees | (9,484) | |
Dividends paid to noncontrolling interest | (130) | (173) |
Proceeds from stock issued under employee stock purchase plan | 57 | 158 |
Proceeds from exercise of stock options | 137 | 1,032 |
Net cash provided by financing activities | 15,039 | 9,316 |
Effect of exchange rate changes on cash | (1,839) | (2,431) |
Net increase (decrease) in cash and cash equivalents | (6,223) | (1,856) |
Cash and cash equivalents - beginning of period | 30,124 | 30,381 |
Cash and cash equivalents - end of period | $ 23,901 | $ 28,525 |
Restatement and Revision of Pre
Restatement and Revision of Previously Reported Consolidated Financial Statements | 9 Months Ended |
Sep. 30, 2015 | |
Restatement and Revision of Previously Reported Consolidated Financial Statements | |
Restatement and Revision of Previously Reported Consolidated Financial Statements | Note 1 — Restatement and Revision of Previously Reported Consolidated Financial Statements Due to the civil and political unrest which commenced in Libya in February 2011, the Company suspended its operations in and demobilized substantially all of its personnel from Libya. At December 31, 2012, the Libya Receivable was approximately $59,937,000, however, because of the political instability and economic uncertainty within Libya and because a promised payment of $31,600,000 in 2011 never materialized, the Company determined that its previous accounting treatment for the Libya Receivable was no longer appropriate as of and for the year ended December 31, 2012. The Company has established a reserve against the entire Libya Receivable amounting to $59,937,000 and eliminated $11,388,000 of certain assets and net liabilities related to that receivable, consisting of sub-consultants and other contingent expenses in 2012, which are contractually owed only upon receipt of payment. These adjustments resulted in a net charge to selling, general and administrative expenses of $48,549,000 for the year ended December 31, 2012. We received approximately $2,880,000 and $6,631,000 in 2013 and 2014, respectively and have paid agency fees and certain taxes amounting to $640,000 and $1,638,000 in 2013 and 2014, respectively. We have accounted for these transactions as a net reduction of selling, general and administrative expenses of $2,240,000 and $4,948,000 in 2013 and 2014, respectively. In addition the Company recorded certain unrelated adjustments to consulting fee revenue, cost of services, selling, general and administrative expenses and income taxes for the year ended December 31, 2014 which also affected the three-month period ended March 31, 2015. In the aggregate, these unrelated adjustments decreased the net earnings by approximately $307,000 for the nine months ended September 30, 2015. These unrelated adjustments were the direct result of the restatement because previous immaterial variances in certain accounts that were not recorded during the December 31, 2014 year end closing process became material when aggregated and assessed against the restated 2014 financial statements. The impact of correcting the misstatement on the Company’s consolidated statements of earnings, comprehensive (loss) earnings and cash flows for the period ended September 30, 2014 is as follows: Nine Months Ended September 30, 2014 As Previously Reported Adjustment As Restated Consolidated Statement of Operations Consulting fee revenue $ $ — $ Reimbursable expenses — Total revenue — Cost of Services — Reimbursable expenses — Total direct costs — Gross profit — Selling, general and administrative expenses ) Operating profit Interest and related financing fees, net — Earnings (loss) before income taxes ) Income tax expense ) Net loss ) ) Less: net earnings - noncontrolling interests — Net loss attributable to Hill International, Inc. $ ) $ $ ) Basic loss per common share - Hill International, Inc. $ ) $ $ ) Diluted loss per common share _ Hill International, Inc. $ ) $ $ ) Nine Months Ended September 30, 2014 Consolidated Statement of Comprehensive Loss Net loss $ ) $ $ ) Foreign currency translation adjustment, net ) ) Other, net — Comprehensive loss ) ) Comprehensive loss attributable to noncontrolling interests — Comprehensive loss attributable to Hill International, Inc. $ ) $ $ ) Nine Months Ended September 30, 2014 Consolidated Statement of Cash Flows Net Loss $ ) $ $ ) Depreciation and amortization — Provision for bad debts — Interest accretion on term loan — Deferred tax expense ) ) ) Share based compensation — Restricted cash — Accounts receivable ) ) ) Accounts receivable - affiliate ) — ) Prepaid expenses and other current assets — Income taxes receivable — Retainage receivable ) — ) Other assets — Accounts payable and accrued expenses ) ) Income taxes payable ) — ) Deferred revenue ) — ) Other current liabilities ) — ) Retainage payable — Other liabilities ) — ) Net cash used in operations ) — ) Investing activities Net cash used in investing activities ) — ) Financing activities Net cash provided by financing activities — Effect of exchange rate changes on cash ) — ) Net decrease in cash and cash equivalents ) — ) Cash and cash equivalents - beginning of period — Cash and cash equivalents - end of period $ $ — $ |
The Company
The Company | 9 Months Ended |
Sep. 30, 2015 | |
The Company | |
The Company | Note 2 - The Company Hill International, Inc. (“Hill” or the “Company”) is a professional services firm that provides program management, project management, construction management, construction claims and other consulting services primarily to the buildings, transportation, environmental, energy and industrial markets worldwide. Hill’s clients include the U.S. federal government, U.S. state and local governments, foreign governments and the private sector. The Company is organized into two key operating divisions: the Project Management Group and the Construction Claims Group. |
Basis of Presentation and Signi
Basis of Presentation and Significant Accounting Policy | 9 Months Ended |
Sep. 30, 2015 | |
Basis of Presentation and Significant Accounting Policy | |
Basis of Presentation and Significant Accounting Policy | Note 3 — Basis of Presentation and Significant Accounting Policy Basis of Presentation The accompanying unaudited interim consolidated financial statements were prepared in accordance with the rules and regulations of the Securities and Exchange Commission pertaining to reports on Form 10-Q and should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K/A for the year ended December 31, 2014. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States (“GAAP”) for complete financial statements. In the opinion of management, these statements include all adjustments (consisting only of normal, recurring adjustments) necessary for a fair presentation of the consolidated financial statements. The consolidated financial statements include the accounts of Hill and its wholly- and majority-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The interim operating results are not necessarily indicative of the results for a full year. Fair Value Measurements Fair value is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining fair value, the Company considers the principal or most advantageous market in which it would transact, and the Company considers assumptions that market participants would use when pricing the asset or liability. It measures certain financial and nonfinancial assets and liabilities at fair value on a recurring and nonrecurring basis. Nonfinancial assets and liabilities include items such as goodwill and long lived assets that are measured at fair value resulting from impairment, if deemed necessary. During the nine months ended September 30, 2015 and 2014, the Company did not record any fair value adjustments to those financial and nonfinancial assets and liabilities measured at fair value on a recurring or nonrecurring basis. |
Acquisitions
Acquisitions | 9 Months Ended |
Sep. 30, 2015 | |
Acquisitions | |
Acquisitions | Note 4 — Acquisitions Our recent acquisition activity is detailed below. The Company’s consolidated financial statements include the operating results of these businesses from their respective dates of acquisition. Pro forma results of operations have not been presented because they are not material to the Company’s consolidated results of operations, either individually or in the aggregate. Engineering S.A. (“ESA”) In April 2015, two shareholders who owned approximately 19% of ESA exercised their ESA Put Options claiming an aggregate value of BRL 10,645,000 (approximately $3,416,000 at September 30, 2015). As an incentive to the sellers to receive Hill’s common stock as payment, the Company offered the sellers a 25% premium. The sellers countered the Company’s offer by requesting payment in common stock at the U.S. dollar value on April 4, 2015 (approximately $4,374,000) as well as a price guarantee upon the sale of the stock during a 30-day period after closing. The Company agreed to the counter offer and paid the liability with 924,736 shares of its common stock in August 2015. On October 6, 2015, the sellers offered 129,648 shares of Hill’s common stock to the Company for a price of approximately $580,000. The Company agreed to acquire the shares which will be placed in treasury. Settlement is expected to occur in late November 2015. The Company now owns approximately 91% of ESA. IMS Proje Yonetimi ve Danismanlik A.S. On April 15, 2015, the Company acquired all of the equity interests of IMS Proje Yonetimi ve Danismanlik A.S. (“IMS”), a firm that provides project management services for international developers, institutional investors and major retailers. IMS had approximately 80 professionals and is headquartered in Istanbul, Turkey. Consideration consisted of an Initial Purchase Price of 12,411,000 Turkish Lira (“TRY”) (approximately $4,640,000 as of the closing date) comprised of TRY 4,139,000 (approximately $1,547,000) paid in cash on the closing date plus a second payment of TRY 8,272,000 (approximately $3,145,000) which was paid on May 12, 2015; a Holdback Purchase Price of TRY 4,400,000 (approximately $1,626,000) payable in cash on April 15, 2016, less any set off related to certain indemnification obligations; and a potential Additional Purchase Price of (i) TRY 1,700,000 (approximately $628,000) if earnings before interest, income taxes, depreciation and amortization for the twelve month period subsequent to the closing date (“EBITDA”) exceeds TRY 3,500,000 (approximately $1,294,000) or (ii) TRY 1,500,000 ($554,000) if EBITDA is less than TRY 3,500,000 but not less than TRY 3,200,000 ($1,183000). The Company accrued the Holdback Purchase Price and the potential Additional Purchase Price of TRY 6,100,000 ($2,255,000), of which TRY 4,400,000 ($1,627,000) is included in other current liabilities and TRY 1,700,000 ($628,000) is included in other liabilities in the consolidated balance sheet at September 30, 2015. The Company acquired intangible assets and goodwill amounting to TRY 10,575,000 (approximately $3,953,000 on the date of acquisition) and TRY 9,421,000 (approximately $3,522,000), respectively. The acquired intangible assets have a weighted average life of seven years. The acquired intangible assets consist of a client relationship intangible of TRY 6,235,000 ($2,331,000) with a ten-year life, a trade name intangible of TRY 434 ,000 ($162,000) with a two-year life and a contract intangible of TRY 3,906,000 ($1,460,000) with a 2.6 year life. Goodwill, which is not deductible for income tax purposes, has been allocated to the Project Management operating segment. Angus Octan Scotland Ltd. On October 31, 2014, our subsidiary Hill International (UK) Ltd. acquired all of the outstanding common stock of Angus Octan Scotland Ltd., which included its subsidiary companies Cadogan Consultants Ltd., Cadogan Consult Ltd. and Cadogan International Ltd. (collectively, “Cadogans”). Cadogans, which had 27 professionals, has offices in Glasgow and Dundee. The acquisition expanded Hill’s construction claims business and provided additional resources in the energy and industrial sectors. Total consideration for the acquisition was £2,719,000 (approximately $4,350,000 at the date of acquisition). The consideration consists of cash payments of £1,000,000 ($1,600,000) at closing, £600,000 ($960,000) on November 25, 2014, £400,000 ($640,000) on December 23, 2014, £519,000 ($830,000) to be paid on October 31, 2015 and an earn-out based upon the average earnings before interest, taxes, depreciation and amortization (“EBITDA”) for the two-year period ending on October 31, 2016 (which amount shall not be less than £0 nor more than £200,000). The Company accrued the potential additional consideration of £719,000 ($1,090,000), of which £519,000 (approximately $787,000 at September 30, 2015) is included in other current liabilities and £200,000 (approximately $303,000 at September 30, 2015) is included in other liabilities in the consolidated balance sheet at September 30, 2015. Two of the selling shareholders may receive an earn-out in five annual installments of up to £100,000 ($152,000 at September 30, 2015), which will be charged to earnings, provided that Cadogans’ EBITDA for each of the years ending October 31, 2015, 2016, 2017, 2018 and 2019 is equal to or greater than £396,000 ($600,000). |
Accounts Receivable
Accounts Receivable | 9 Months Ended |
Sep. 30, 2015 | |
Accounts Receivable. | |
Accounts Receivable | Note 5 — Accounts Receivable The components of accounts receivable are as follows (in thousands): September 30, 2015 December 31, 2014 Billed $ $ Retainage, current portion Unbilled Allowance for doubtful accounts ) ) $ $ Libya Receivable The Company has open but inactive contracts with the Libyan Organization for the Development of Administrative Centres (“ODAC”). Due to the civil unrest which commenced in Libya in February 2011, the Company suspended its operations in and demobilized substantially all of its personnel from Libya. At December 31, 2012, the balance of the Libya Receivable was approximately $59,937,000. Because of the continuing political instability in Libya, the Company established a reserve for the full amount of the receivable at December 31, 2012. During 2013, the Company received payments on the Libya Receivable of approximately $2,880,000. In the first quarter of 2014, the Company received an additional payment of approximately $6,631,000 against the Libya Receivable which has been reflected as a reduction of selling, general and administrative (“SG&A”) expenses for the nine-months ended September 30, 2014. At September 30, 2015, after a decrease of approximately $1,151,000 due to the effect of foreign exchange translation losses, the Libya Receivable was approximately $49,275,000 which continues to be fully reserved. It is management’s intention to continue to pursue collection of monies owed to the Company by ODAC and, if subsequent payments are received, the Company will reflect such receipts, net of any third party obligations related to the collections, as reductions of SG&A expenses. |
Intangible Assets
Intangible Assets | 9 Months Ended |
Sep. 30, 2015 | |
Intangible Assets | |
Intangible Assets | Note 6 — Intangible Assets The following table summarizes the Company’s acquired intangible assets (in thousands): September 30, 2015 December 31, 2014 Gross Gross Carrying Accumulated Carrying Accumulated Amount Amortization Amount Amortization Client relationships $ $ $ $ Acquired contract rights Trade names Total $ $ $ $ Intangible assets, net $ $ Amortization expense related to intangible assets was as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 $ $ $ $ The following table presents the estimated amortization expense based on our present intangible assets for the next five years (in thousands): Estimated Amortization Year Ending December 31, Expense 2015 (remaining 3 months) $ 2016 2017 2018 2019 |
Goodwill
Goodwill | 9 Months Ended |
Sep. 30, 2015 | |
Goodwill | |
Goodwill | Note 7 — Goodwill The Company performs its annual goodwill impairment testing, by reporting unit, in the third quarter, or more frequently if events or changes in circumstances indicate that goodwill may be impaired. Application of the goodwill impairment test requires significant judgments including estimation of future cash flows, which is dependent on internal forecasts, estimation of the long-term rate of growth for the businesses, the useful life over which cash flows will occur, and determination of the Company’s weighted average cost of capital. Changes in these estimates and assumptions could materially affect the determination of fair value and/or conclusions on goodwill impairment for each reporting unit. The Company performed its annual impairment test effective July 1, 2015. Based on a preliminary valuation, the fair value of the Project Management unit and the Construction Claims unit significantly exceeded their carrying. The following table summarizes the changes in the Company’s carrying value of goodwill during 2015 (in thousands): Project Construction Management Claims Total Balance, December 31, 2014 $ $ $ Additions — Translation adjustments ) ) ) Balance, September 30, 2015 $ $ $ |
Accounts Payable and Accrued Ex
Accounts Payable and Accrued Expenses | 9 Months Ended |
Sep. 30, 2015 | |
Accounts Payable and Accrued Expenses | |
Accounts Payable and Accrued Expenses | Note 8 — Accounts Payable and Accrued Expenses Below are the components of accounts payable and accrued expenses (in thousands): September 30, 2015 December 31, 2014 Accounts payable $ $ Accrued payroll Accrued subcontractor fees Accrued agency fees Accrued legal and professional fees Other accrued expenses $ $ |
Notes Payable and Long-Term Deb
Notes Payable and Long-Term Debt | 9 Months Ended |
Sep. 30, 2015 | |
Notes Payable and Long-Term Debt | |
Notes Payable and Long-Term Debt | Note 9 — Notes Payable and Long-Term Debt Outstanding debt obligations are as follows (in thousands): September 30, 2015 December 31, 2014 Term Loan Facility $ $ Domestic Revolving Credit Facility International Revolving Credit Facility Borrowings under revolving credit facilities with a consortium of banks in Spain Borrowing under unsecured credit facility with Ibercaja Bank in Spain Borrowing from Philadelphia Industrial Development Corporation — Other notes payable — Less current maturities Notes payable and long-term debt, net of current maturities $ $ Refinancing Effective as of September 26, 2014 (the “Closing Date”), the Company, entered into a credit agreement with Société Générale, as administrative agent (the “Agent”) and collateral agent, TD Bank, N.A., as syndication agent and HSBC Bank USA, N.A., as documentation agent, (collectively, the “U.S. Lenders”) consisting of a term loan facility of $120,000,000 (the “Term Loan Facility”) and a $30,000,000 U.S. dollar-denominated facility available to the Company (the “U.S. Revolver,” together with the Term Loan Facility, the “U.S. Credit Facilities”) and a credit agreement with the Agent, as administrative agent and collateral agent, (the “International Lender”) providing a facility of approximately €11,765,000 ($15,000,000 at the closing date and $13,240,000 at September 30, 2015) which is available to the Subsidiary (the “International Revolver” and together with the U.S. Revolver, the “Revolving Credit Facilities” and, together with the U.S. Credit Facilities, the “Secured Credit Facilities”). The U.S. Revolver and the International Revolver include sub-limits for letters of credit amounting to $25,000,000 and €8,000,000, respectively. The Secured Credit Facilities contain customary default provisions, representations and warranties, and affirmative and negative covenants, and require the Company to comply with certain financial and reporting covenants (see Note 19). The financial covenants consist of a Maximum Consolidated Net Leverage Ratio and an Excess Account Concentration requirement. The Consolidated Net Leverage Ratio is the ratio of (a) consolidated total debt (minus cash of up to $10,000,000 held in the aggregate) to consolidated earnings before interest, taxes, depreciation, amortization and share-based compensation for the trailing twelve months. The Excess Account Concentration covenant permits the U.S. Lenders and the International Lender to increase the interest rates by 2.0% if, as of the last day of any fiscal quarter, either (a) the total of accounts receivable from all clients within any country not listed as a Permitted Country as defined in the Secured Credit Facilities (other than the United Arab Emirates) that are more than 120 days old (relative to the invoice date) constitute more than 10% of the total outstanding accounts receivable or (b) accounts receivable from any individual client located in the United Arab Emirates that are more than 120 days old (relative to the invoice date) constitute more than 14% of the total outstanding accounts receivable; provided that, in each case, the accounts receivable due from clients located in Libya that exist as of the Closing Date shall be excluded for all purposes of this covenant. The interest rate will be reset as soon as the accounts receivable over 120 days decline below the 10% or 14% levels. At September 30, 2015, non-permitted accounts receivable did not exceed the limits set forth above. The following compares the Maximum Consolidated Net Leverage Ratio to the actual consolidated net leverage ratio at September 30, 2015: Not to exceed Actual 3.25 to 1.00 3.03 to 1.00 The U.S. Credit Facilities are guaranteed by certain U.S. subsidiaries of the Company, and the International Revolver is guaranteed by the Company and certain of the Company’s U.S. and non-U.S. subsidiaries. Term Loan Facility The interest rate on the Term Loan Facility will be, at the Company’s option, either: · the London Inter-Bank Offered Rate (“LIBOR”) for the relevant interest period plus 6.75% per annum, provided that such LIBOR shall not be lower than 1.00% per annum; or · the Base Rate (as described below) plus 5.75% per annum. The “Base Rate” is a per annum rate equal to the highest of (A) the prime rate, (B) the federal funds effective rate plus 0.50%, or (C) the LIBOR for an interest period of one month plus 1.0% per annum. Upon a default, the applicable rate of interest under the Secured Credit Facilities may increase by 2.0%. The LIBOR on the Term Loan Facilities (including when determining the Base Rate) shall in no event be less than 1.0% per annum. The Company has the right to prepay the Term Loan Facility in full or in part at any time without premium or penalty. The Company is required to make mandatory prepayments of the Term Loan Facility, without premium or penalty, (i) with net proceeds of any issuance or incurrence of indebtedness (other than that permitted under the Term Loan Facility) by the Company, (ii) with net proceeds from certain asset sales outside the ordinary course of business, and (iii) with 50% of the excess cash flow (as defined in the agreement) for each fiscal year of the Borrowers commencing with the year ending December 31, 2015 (which percentage would be reduced to 25% if the Consolidated Net Leverage Ratio is equal to or less than 2.25 to 1.00 or reduced to 0% if the Consolidated Net Leverage Ratio is equal to or less than 1.50 to 1.00). The Term Loan Facility is generally secured by a first-priority security interest in substantially all assets of the Company and certain of the Company’s U.S. subsidiaries other than accounts receivable, cash proceeds thereof and certain bank accounts, as to which the Term Loan Facility is secured by a second-priority security interest. The Term Loan Facility has a term of six years, requires repayment of 0.25% of the original principal amount on a quarterly basis through September 30, 2020, the maturity date. Any amounts repaid on the Term Loan Facility will not be available to be re-borrowed. The Company incurred fees and expenses related to the Term Loan Facility aggregating $7,066,000 which were deferred. The deferred fees are being amortized on a straight-line basis, which approximates the effective interest method, to interest and related financing fees, net over a six-year period which ends on September 30, 2020. Unamortized balances of $5,888,000 and $6,772,000 are included in other assets in the consolidated balance sheets at September 30, 2015 and December 31, 2014, respectively. Revolving Credit Facilities The interest rate on borrowings under the U.S. Revolver will be, at the Company’s option from time to time, either the LIBOR for the relevant interest period plus 3.75% per annum or the Base Rate plus 2.75% per annum. The interest rate on borrowings under the International Revolver will be the European Inter-Bank Offered Rate, or “EURIBOR,” for the relevant interest period (or at a substitute rate to be determined to the extent EURIBOR is not available) plus 4.00% per annum. The Company will pay a commitment fee calculated at 0.50% annually on the average daily unused portion of the U.S. Revolver, and the Subsidiary will pay a commitment fee calculated at 0.75% annually on the average daily unused portion of the International Revolver. The ability to borrow under each of the U.S. Revolver and the International Revolver is subject to a “borrowing base,” calculated using a formula based upon approximately 85% of receivables that meet or satisfy certain criteria (“Eligible Receivables”) and that are subject to a perfected security interest held by either the U.S. Lenders or the International Lender, plus, in the case of the International Revolver only, 10% of Eligible Receivables that are not subject to a perfected security interest held by the International Lender, subject to certain exceptions and restrictions. The Company or the Subsidiary, as applicable, will be required to make mandatory prepayments under their respective Revolving Credit Facilities to the extent that the aggregate outstanding amount thereunder exceeds the then-applicable borrowing base, which payments will be made without penalty or premium. At September 30, 2015, the domestic borrowing base was $30,000,000 and the international borrowing base was €11,795,000 (approximately $13,240,000 at September 30, 2015). Generally, the obligations of the Company under the U.S. Revolver are secured by a first-priority security interest in the above-referenced accounts receivable, cash proceeds and bank accounts of the Company and certain of the Company’s U.S. subsidiaries, and a second-priority security interest in substantially all other assets of the Company and such subsidiaries. The obligations of the Subsidiary under the International Revolver would generally be secured by a first-priority security interest in substantially all accounts receivable, cash proceeds thereof and certain bank accounts of the Subsidiary and certain of the Company’s non-U.S. subsidiaries, and a second-priority security interest in substantially all other assets of the Company and certain of the Company’s U.S. and non-U.S. subsidiaries. The Revolving Credit Facilities have a term of five years and require payment of interest only during the term. Under the Revolving Credit Facilities, outstanding loans may be repaid in whole or in part at any time, without premium or penalty, subject to certain customary limitations, and will be available to be re-borrowed from time to time through expiration on September 30, 2019. The Company incurred fees and expenses related to the Revolving Credit Facilities aggregating $3,000,000 which was deferred. The deferred fees are being amortized on a straight-line basis, which approximates the effective interest method, to interest expense and related financing fees, net over a five-year period which ends on September 30, 2019. Unamortized balances of $2,400,000 and $2,850,000 are included in other assets in the consolidated balance sheet at September 30, 2015 and December 31, 2014, respectively. At September 30, 2015, the Company had $9,286,000 of outstanding letters of credit and $12,214,000 of available borrowing capacity under the U.S. Revolver. At September 30, 2015, the Company had $1,881,000 of outstanding letters of credit and $893,000 of available borrowing capacity under the International Revolver and its other foreign credit agreements (See “Other Debt Arrangements” below for more information). Other Debt Arrangements In connection with the move of its corporate headquarters to Philadelphia, Pennsylvania, the Company received a loan from the Philadelphia Industrial Development Corporation in the amount of $750,000 which bears interest at 2.75%, is repayable in 144 equal monthly installments of $6,121 and matures on May 1, 2027. The Company’s subsidiary, Hill International (Spain) S.A. (“Hill Spain”), maintains a revolving credit facility with six banks (the “Financing Entities”) in Spain which initially provided for total borrowings of up to €5,340,000 with interest at 6.50% on outstanding borrowings. Total availability under this facility was reduced to 75.0% of the initial limit at December 31, 2014 and will be reduced to 50.0% at December 31, 2015. At September 30, 2015, the total facility was approximately €4,005,000 (approximately $4,507,000) and borrowings outstanding were €3,986,000 (approximately $4,486,000). The amount being financed (“Credit Contracts”) by each Financing Entity is between €284,000 (approximately $320,000) and €1,154,000 (approximately $1,299,000). To guarantee Hill Spain’s obligations resulting from the Credit Contracts, Hill Spain provided a guarantee in favor of each one of the Financing Entities, which, additionally, and solely in the case of unremedied failure to make payment, and at the request of each of the Financing Entities, shall grant a first ranking pledge over a given percentage of corporate shares of Hill International Brasil Participacoes Ltda. for the principal, interest, fees, expenses or any other amount owed by virtue of the Credit Contracts, coinciding with the percentage of credit of each Financing Entity with respect to the total outstanding borrowings under this facility. The facility expires on December 17, 2016. Hill Spain also maintains an ICO (Official Credit Institute) loan with Bankia Bank in Spain for €120,000 (approximately $135,000) at September 30, 2015. The availability is reduced by €15,000 on a quarterly basis. At September 30, 2015, total borrowings outstanding were €120,000. The interest rate at September 30, 2015 was 5.91%. The ICO loan expires on August 10, 2017. Hill Spain maintains an unsecured credit facility with the Ibercaja Bank in Spain for €175,000 (approximately $197,000) at September 30, 2015. The availability is being reduced by €175,000 at the end of each calendar quarter. At September 30, 2015, total borrowings outstanding were €175,000. The interest rate at September 30, 2015 was 6.75%. The facility expires on December 31, 2015. The Company maintains a credit facility with the National Bank of Abu Dhabi which provides for total borrowings of up to AED 11,500,000 (approximately $3,131,000 at September 30, 2015) collateralized by certain overseas receivables. At September 30, 2015, there were no borrowings outstanding. The interest rate is the one-month Emirates InterBank Offer Rate plus 3.00% (or 4.41% at September 30, 2015) but no less than 5.50%. This facility was modified in June 2015 to increase availability under Letters of Guarantee to allow for up to AED 200,000,000 (approximately $54,500,000 at September 30, 2015) of which AED 95,221,000 (approximately $25,900,000) was outstanding at September 30, 2015. The credit facility will expire on May 7, 2016. Engineering S.A. maintains four unsecured revolving credit facilities with two banks in Brazil aggregating 2,220,000 Brazilian Reais (BRL) (approximately $542,000 at September 30, 2015), with a weighted average interest rate of 3.69% per month at September 30, 2015. There were no borrowings outstanding on any of these facilities which are renewed automatically every three months. The Company also maintains relationships with other foreign banks for the issuance of letters of credit, letters of guarantee and performance bonds in a variety of foreign currencies. At September 30, 2015, the maximum U.S. dollar equivalent of the commitments was $80,163,000 of which $42,042,000 is outstanding. |
Supplemental Cash Flow Informat
Supplemental Cash Flow Information | 9 Months Ended |
Sep. 30, 2015 | |
Supplemental Cash Flow Information | |
Supplemental Cash Flow Information | Note 10 — Supplemental Cash Flow Information The following table provides additional cash flow information (in thousands): Nine Months Ended September 30, 2015 2014 Interest and related financing fees paid $ $ Income taxes paid $ $ Increase in property and equipment from a tenant improvement allowance related to the relocation of the corporate headquarters $ $ — Reduction of noncontrolling interest in connection with acquisition of an additional interest in Engineering S.A. $ ) $ ) Increase in additional paid in capital from issuance of shares of common stock related to purchase of CPI $ $ Increase in additional paid in capital from issuance of shares of common stock from cashless exercise of stock options $ $ |
Earnings per Share
Earnings per Share | 9 Months Ended |
Sep. 30, 2015 | |
Earnings per Share | |
Earnings per Share | Note 11 — Earnings per Share Basic earnings per common share has been computed using the weighted-average number of shares of common stock outstanding during the period. Diluted loss per common share incorporates the incremental shares issuable upon the assumed exercise of stock options, if dilutive. Dilutive stock options increased the average common shares outstanding by approximately 684,000 shares for the three months ended September 30, 2015 and by approximately 613,000 shares for the nine months ended September 30, 2015. Options to purchase 3,208,000 shares and 3,773,000 shares were excluded from the calculation of diluted earnings per common share for the three- and nine-month periods ended September 30, 2015 because they were antidilutive. Dilutive stock options increased the average common shares outstanding by approximately 144,000 shares for the three months ended September 30, 2014 and by approximately 186,000 shares for the nine months ended September 30, 2014. Options to purchase 7,437,000 shares and 7,460,000 shares were excluded from the calculation of diluted (loss) earnings per common share for the three- and nine-month periods ended September 30, 2014 because they were antidilutive. |
Share-Based Compensation
Share-Based Compensation | 9 Months Ended |
Sep. 30, 2015 | |
Share-Based Compensation | |
Share-Based Compensation | Note 12 — Share-Based Compensation At September 30, 2015, the Company had approximately 7,908,000 options outstanding with a weighted average exercise price of $4.40. During the nine months ended September 30, 2015, the Company granted 1,035,000 options which vest over a five-year period and 63,000 options which vested immediately. The options have a weighted-average exercise price of $4.03 and a weighted average contractual life of 6.9 years. The aggregate fair value of the options was $2,221,000 calculated using the Black-Scholes valuation model. The weighted average assumptions used to calculate fair value were: expected life — 4.9 years; volatility — 59.1% and risk-free interest rate — 1.45%. During the nine months ended September 30, 2015, options for 139,000 shares with a weighted average exercise price of $3.59 were exercised, options for approximately 383,000 shares with a weighted average exercise price of $6.90 lapsed and options for 28,000 shares with a weighted average exercise price of $4.40 were forfeited. During the nine months ended September 30, 2015, employees purchased approximately 18,000 common shares, for an aggregate purchase price of $57,000, pursuant to the Company’s 2008 Employee Stock Purchase Plan. The Company recognized share-based compensation expense in selling, general and administrative expenses in the consolidated statement of operations totaling $899,000 and $785,000 for the three months ended September 30, 2015 and 2014, respectively, and $2,360,000 and $2,712,000 for the nine months ended September 30, 2015 and 2014, respectively. |
Stockholders' Equity
Stockholders' Equity | 9 Months Ended |
Sep. 30, 2015 | |
Stockholders' Equity | |
Stockholders' Equity | Note 13 — Stockholders’ Equity The following table summarizes the changes in stockholders’ equity during the nine months ended September 30, 2015 (in thousands): Hill International, Noncontrolling Total Inc. Stockholders Interests Stockholders’ equity, December 31, 2014 $ $ $ Net earnings Other comprehensive (loss) ) ) ) Comprehensive earnings (loss) ) ) ) Additional paid in capital — Acquisition of treasury stock ) ) — Adjustment related to ESA put options — ) Stock issued for acquisition of CPI — Stockholders’ equity, September 30, 2015 $ $ $ During May 2015, four of the Company’s directors exercised an aggregate of 84,868 options with an exercise price of $4.25 through the Company on a cashless basis. The Company withheld 67,400 shares as payment for the options and placed those shares in treasury. The directors received a total of 17,468 shares from this transaction. During the nine months ended September 30, 2015, the Company received cash proceeds of $137,000 from the exercise of stock options. In April 2015, two shareholders who own approximately 19% of ESA exercised their ESA Put Options. On August 12, 2015, the Company paid the liability in shares of its common stock. See Note 4 for further information. On May 4, 2015, the Company’s Board of Directors approved the adoption of a stockholder rights plan and, on June 9, 2015, they rescinded that plan. |
Income Taxes
Income Taxes | 9 Months Ended |
Sep. 30, 2015 | |
Income Taxes | |
Income Taxes | Note 14 — Income Taxes The effective tax rates for the three months ended September 30, 2015 and 2014 were 55.8% and (78.9%), respectively, and 47.8% and 125.8% for the nine months ended September 30, 2015 and 2014, respectively. The Company’s effective tax rate represents the Company’s effective tax rate for the year based on projected income and mix of income among the various foreign tax jurisdictions, adjusted for discrete transactions occurring during the period. There was no change in the reserve for uncertain tax positions for the three months ended September 30, 2015 and 2014. For the nine months ended September 30, 2015 and 2014, the Company recognized an income tax expense (benefit) related to an increase (decrease) in the reserve for uncertain tax positions of $245,000 and ($2,514,000), respectively. In addition, the Company recognized an income tax (benefit) expense resulting from adjustments to agree the prior year’s book amounts to the actual amounts per the tax returns totaling ($37,000) and $206,000 for the three months ended September 30, 2015 and 2014, respectively, and ($37,000) and $250,000 for the nine months ended September 30, 2015 and 2014, respectively. For both years, the Company’s effective tax rate is significantly higher than it otherwise would be primarily as a result of various foreign withholding taxes and not being able to record an income tax benefit related to the U.S. net operating loss. The components of earnings (loss) before income taxes and the related income tax expense by United States and foreign jurisdictions were as follows (in thousands): Three Months Ended September 30, 2015 Three Months Ended September 30, 2014 U.S. Foreign Total U.S. Foreign Total Earnings (loss) before income taxes $ ) $ $ $ ) $ $ ) Income tax expense, net $ — $ $ $ — $ $ Nine Months Ended September 30, 2015 Nine Months Ended September 30, 2014 U.S. Foreign Total U.S. Foreign Total (Restated) (Restated) Earnings (loss) before income taxes $ ) $ $ $ ) $ $ Income tax expense, net $ — $ $ $ — $ $ The reserve for uncertain tax positions amounted to $1,220,000 and $975,000 at September 30, 2015 and December 31, 2014, respectively, and is included in “Other liabilities” in the consolidated balance sheet at those dates. During the three and nine months ended September 30, 2015, the reserve for uncertain tax positions was increased by $0 and $245,000, respectively, and was due to certain tax positions taken in foreign jurisdictions. During the three months ended September 30, 2014, the reserve for uncertain tax positions was reduced by $2,514,000 based on management’s assessment that these items were effectively settled with the appropriate foreign tax authorities. During the nine months ended September 30, 2014, the Company also reclassified $420,000 from “Income taxes payable” to the reserve for uncertain tax positions primarily taken in foreign jurisdictions. The Company’s policy is to record income tax related interest and penalties in income tax expense. At September 30, 2015 and December 31, 2014, potential interest and penalties related to uncertain tax positions amounting to $520,000 and $592,000 was included in the balance above. In assessing the realizability of deferred tax assets, management considers whether it is more likely than not that some portion or all of the deferred tax assets will not be realized. The ultimate realization of deferred tax assets is dependent upon the generation of future taxable income during the periods in which those temporary differences become deductible. Management considers the scheduled reversal of deferred tax liabilities and projected future taxable income in making this assessment. Management evaluates the need for valuation allowances on the deferred tax assets according to the provisions of ASC740, Income Taxes. They consider both positive and negative evidence. In making this determination, management assesses all of the evidence available at the time including recent earnings, internally-prepared income projections, and historical financial performance. |
Business Segment Information
Business Segment Information | 9 Months Ended |
Sep. 30, 2015 | |
Business Segment Information | |
Business Segment Information | Note 15 — Business Segment Information The Company’s business segments reflect how executive management makes resource decisions and assesses its performance. The Company bases these decisions on the type of services provided (Project Management and Construction Claims) and secondarily by their geography (U.S./Canada, Latin America, Europe, the Middle East, Africa and Asia/Pacific). The Project Management business segment provides extensive construction and project management services to construction owners worldwide. Such services include program management, project management, construction management, project management oversight, troubled project turnaround, staff augmentation, project labor agreement consulting, commissioning, estimating and cost management, labor compliance and facilities management services. The Construction Claims business segment provides such services as claims consulting, management consulting, litigation support, expert witness testimony, cost/damages assessment, delay/disruption analysis, adjudication, lender advisory, risk management, forensic accounting, fraud investigation, Project Neutral and international arbitration services. The Company evaluates the performance of its segments primarily on operating profit before corporate overhead allocations and income taxes. The following tables reflect the required disclosures for the Company’s reportable segments (in thousands): Consulting Fee Revenue (“CFR”) Three Months Ended September 30, 2015 2014 Project Management $ % $ % Construction Claims Total $ % $ % Total Revenue Three Months Ended September 30, 2015 2014 Project Management $ % $ % Construction Claims Total $ % $ % Operating Profit Three Months Ended September 30, 2015 2014 Project Management before equity in loss of affiliate $ $ Equity in loss of affiliate ) — Total Project Management Construction Claims Corporate ) ) Total $ $ Depreciation and Amortization Expense Three Months Ended September 30, 2015 2014 Project Management $ $ Construction Claims Subtotal segments Corporate Total $ $ Consulting Fee Revenue by Geographic Region Three Months Ended September 30, 2015 2014 U.S./Canada $ % $ % Latin America Europe Middle East Africa Asia/Pacific Total $ % $ % U.S. $ % $ % Non-U.S. Total $ % $ % During the third quarter ended September 30, 2015, consulting fee revenue for the United Arab Emirates amounted to $29,642,000 representing 18.7% of the total. No other country other than the United States accounted for 10% or more of consolidated consulting fee revenue. During the third quarter ended September 30, 2014, consulting fee revenue for the United Arab Emirates amounted to $18,666,000 representing 12.8% of the total and Oman’s consulting fee revenue amounted to $16,098,000 representing 11.1% of the total. No other country other than the United States accounted for 10% or more of consolidated consulting fee revenue. Total Revenue by Geographic Region Three Months Ended September 30, 2015 2014 U.S./Canada $ % $ % Latin America Europe Middle East Africa Asia/Pacific Total $ % $ % U.S. $ % $ % Non-U.S. Total $ % $ % During the third quarter ended September 30, 2015, total revenue for the United Arab Emirates amounted to $30,910,000 representing 17.3% of the total. No other country except for the United States accounted for 10% or more of consolidated total revenue. During the third quarter ended September 30, 2014, total revenue for the United Arab Emirates amounted to $19,112,000 representing 11.8% of the total and Oman’s total revenue amounted to $16,960,000 representing 10.5% of the total. No other country except for the United States accounted for 10% or more of consolidated total revenue. Consulting Fee Revenue By Client Type Three Months Ended September 30, 2015 2014 U.S. federal government $ % $ % U.S. state, regional and local governments Foreign governments Private sector Total $ % $ % Total Revenue By Client Type Three Months Ended September 30, 2015 2014 U.S. federal government $ % $ % U.S. state, regional and local governments Foreign governments Private sector Total $ % $ % Property, Plant and Equipment, Net by Geographic Location September 30, 2015 December 31, 2014 U.S./Canada $ $ Latin America Europe Middle East Africa Asia/Pacific Total $ $ U.S. $ $ Non-U.S. Total $ $ Consulting Fee Revenue (“CFR”) Nine Months Ended September 30, 2015 2014 Project Management $ % $ % Construction Claims Total $ % $ % Total Revenue Nine Months Ended September 30, 2015 2014 Project Management $ % $ % Construction Claims Total $ % $ % Operating Profit Nine Months Ended September 30, 2015 2014 (Restated) Project Management $ $ Equity in loss of affiliate ) — Total Project Management Construction Claims Corporate ) ) Total $ $ Depreciation and Amortization Expense Nine Months Ended September 30, 2015 2014 Project Management $ $ Construction Claims Subtotal segments Corporate Total $ $ Consulting Fee Revenue by Geographic Region Nine Months Ended September 30, 2015 2014 U.S./Canada $ % $ % Latin America Europe Middle East Africa Asia/Pacific Total $ % $ % U.S. $ % $ % Non-U.S. Total $ % $ % During the nine months ended September 30, 2015, consulting fee revenue for the United Arab Emirates amounted to $83,613,000 representing 17.8% of the total. No other country except the United States accounted for 10% or more of consolidated consulting fee revenue. During the nine months ended September 30, 2014, consulting fee revenue for the United Arab Emirates amounted to $52,385,000 representing 12.3% of the total and Oman’s consulting fee revenue amounted to $50,175,000 representing 11.7% of the total. No other country except the United States accounted for 10% or more of consolidated consulting fee revenue. Total Revenue by Geographic Region Nine Months Ended September 30, 2015 2014 U.S./Canada $ % $ % Latin America Europe Middle East Africa Asia/Pacific Total $ % $ % U.S. $ % $ % Non-U.S. Total $ % $ % During the nine months ended September 30, 2015, total revenue for the United Arab Emirates amounted to $85,898,000 representing 16.2% of the total. No other country except for the United States accounted for 10% or more of consolidated total revenue. During the nine months ended September 30, 2014, total revenue for the United Arab Emirates amounted to $53,352,000 representing 11.3% of the total and Oman’s total revenue amounted to $53,773,000 representing 11.4% of the total. No other country except for the United States accounted for 10% or more of consolidated total revenue. Consulting Fee Revenue By Client Type Nine Months Ended September 30, 2015 2014 U.S. federal government $ % $ % U.S. state, regional and local governments Foreign governments Private sector Total $ % $ % Total Revenue By Client Type Nine Months Ended September 30, 2015 2014 U.S. federal government $ % $ % U.S. state, regional and local governments Foreign governments Private sector Total $ % $ % |
Client Concentrations
Client Concentrations | 9 Months Ended |
Sep. 30, 2015 | |
Client Concentrations | |
Client Concentrations | Note 16 — Client Concentrations The Company had no clients that accounted for 10% or more of consulting fee revenue during the three and nine months ended September 30, 2015 and one client located in Oman that accounted for 10.4% and 11.1% of consulting fees during the three and nine months ended September 30, 2014, respectively. The Company had no clients that accounted for 10% or more of total revenue during the three and nine months ended September 30, 2015 and one client, located in Oman, that accounted for 10.1% of total revenue during the nine months ended September 30, 2014. The Company has numerous contracts with U.S. federal government agencies that collectively accounted for 1.4% and 3.1% of consulting fee revenue during the three months ended September 30, 2015 and 2014 and 1.5% and 2.6% of consulting revenue during the nine months ended September 30, 2015 and 2014. The Company has numerous contracts with U.S. federal government agencies that collectively accounted for 1.6% and 3.6% of total revenue during each of the three months ended September 30, 2015 and 2014 and 1.6% and 2.9% of total revenue during the nine months ended September 30, 2015 and 2014. |
Commitments and Contingencies
Commitments and Contingencies | 9 Months Ended |
Sep. 30, 2015 | |
Commitments and Contingencies | |
Commitments and Contingencies | Note 17 — Commitments and Contingencies General Litigation M.A. Angeliades, Inc. (“Plaintiff”) filed a complaint with the Supreme Court of New York against the Company and the New York City Department of Design and Construction (“DDC”) regarding payment of approximately $8,771,000 for work performed as a subcontractor to the Company plus interest and other costs. On October 5, 2015, pursuant to a settlement agreement, Hill paid Plaintiff approximately $2,596,000, including interest amounting to $1,056,000, of which $448,000 had been previously accrued and $608,000 was charged to expense for the three and nine months ended September 30, 2015. The remaining issues regarding Plaintiff’s requests for change orders and compensation for delay are being negotiated between Plaintiff and the DDC. A former executive of the Company (“Plaintiff”) resigned and filed a labor dispute with the Company in the Dubai Labour Court seeking AED 4,536,239 for end of service remuneration. The Company filed a counterclaim against Plaintiff for breach of employment contract and filed a complaint against Plaintiff’s new employer, Driver Group plc, in the UK for breach of non-solicitation and non-compete obligations in Plaintiff’s employment agreement. On June 15, 2015, the Company paid Plaintiff AED 750,000 ($200,000) pursuant to an executed settlement agreement. During the nine months ended September 30, 2015, the Company recorded an additional $100,000 associated with the settlement payment and $834,000 of related legal costs. From time to time, the Company is a defendant or plaintiff in various legal actions which arise in the normal course of business. As such the Company is required to assess the likelihood of any adverse outcomes to these matters as well as potential ranges of probable losses. A determination of the amount of the provision required for these commitments and contingencies, if any, which would be charged to earnings, is made after careful analysis of each matter. The provision may change in the future due to new developments or changes in circumstances. Changes in the provision could increase or decrease the Company’s earnings in the period the changes are made. It is the opinion of management, after consultation with legal counsel, that the ultimate resolution of these matters will not have a material adverse effect on the Company’s financial condition, results of operations or cash flows. Acquisition-Related Contingencies As of September 30, 2015 our subsidiary, Hill International (Spain), S.A. (“Hill Spain”), owned an indirect 91% interest in Engineering S.A. (“ESA”), a firm located in Brazil. ESA’s shareholders entered into an agreement whereby the minority shareholders have a right to compel (“ESA Put Option”) Hill Spain to purchase any or all of their shares during the period from February 28, 2014 to February 28, 2021. Hill Spain also has the right to compel (“ESA Call Option”) the minority shareholders to sell any or all of their shares during the same time period. The purchase price for such shares shall be seven times the earnings before interest and taxes for ESA’s most recently ended fiscal year, net of any financial debt plus excess cash multiplied by a percentage which the shares to be purchased bear to the total number of shares outstanding at the time of purchase, but in the event the ESA Call Option is exercised by Hill Spain, the purchase price shall be increased by five percent. The ESA Put Option and the ESA Call Option must be made within three months after the audited financial statements of ESA have been completed. The Company is committed to pay additional consideration for the purchase of Cadogans in the amount of £600,000, adjusted for the amount by which the net assets of Cadogans is above or below £1,000,000 as of October 31, 2015. The Company paid £579,000 (approximately $894,000) in satisfaction of this obligation on October 31, 2015. Also, the sellers are entitled to an earn-out based upon the average earnings before interest, taxes, depreciation and amortization for the two-year period ending on October 31, 2016 (which amount shall not be less than £0 or more than £200,000). See Note 4. |
Other Matters
Other Matters | 9 Months Ended |
Sep. 30, 2015 | |
Other Matters | |
Other Matters | Note 18 — Other Matters In connection with the move of its corporate headquarters to Philadelphia, Pennsylvania, the Company received the following from the Commonwealth of Pennsylvania, the City of Philadelphia and the Philadelphia Industrial Development Corporation: · a $1,000,000 grant received on July 13, 2015. The terms of the grant require the Company to spend at least $6,425,000 on capital expenditures for leasehold improvements and equipment for its new headquarters, remain at One Commerce Square for at least seven years and employ at least 359 persons no later than April 1, 2018. The Company has met the capital expenditure requirement and has a twelve year lease for its corporate headquarters. Upon receipt of the funds, the Company recorded a deferred credit which, assuming the employment requirement is met, will be reflected in income in the second quarter of 2018; · a low interest loan amounting to $750,000. See Note 9; and · a loan amounting to $345,000 which is forgivable if the Company achieves and maintains certain employment levels within the City of Philadelphia by April 30, 2020. The Company is accounting for this item in a manner similar to the grant and has included the deferred credit in other liabilities in the consolidated balance sheet at June 30, 2015. Assuming the employment levels are met, the Company will reflect the item in income in the second quarter of 2020. Additionally, the Company may be eligible to receive job creation tax credits of up to $666,000 from the Commonwealth of Pennsylvania and up to $1,150,000 from the City of Philadelphia. The landlord for the new headquarters provided the Company with a tenant improvement allowance amounting to approximately $3,894,000. The tenant improvement allowance has been deferred, is included in other liabilities in the consolidated balance sheet at September 30, 2015 and is being amortized on a straight-line basis against rent expense over the term of the twelve-year lease commencing on May 1, 2015. |
Subsequent Event
Subsequent Event | 9 Months Ended |
Sep. 30, 2015 | |
Subsequent Event. | |
Subsequent Event | Note 19 — Subsequent Event In connection with the restatement of its consolidated financial statements as of and for the year ended December 31, 2014 and as of and for the periods ended March 31, 2015 and June 30, 2015, the Company became in technical default of its Secured Credit Facilities due to certain misrepresentations, reporting and affirmative covenant breaches. On November 3, 2015, the Company received a waiver of the default. The Company paid $81,900 and other out-of-pocket expenses incurred by the Administrative Agent. |
Basis of Presentation and Sig26
Basis of Presentation and Significant Accounting Policy (Policies) | 9 Months Ended |
Sep. 30, 2015 | |
Basis of Presentation and Significant Accounting Policy | |
Basis of Presentation | Basis of Presentation The accompanying unaudited interim consolidated financial statements were prepared in accordance with the rules and regulations of the Securities and Exchange Commission pertaining to reports on Form 10-Q and should be read in conjunction with the consolidated financial statements and accompanying notes included in the Company’s Annual Report on Form 10-K/A for the year ended December 31, 2014. Accordingly, they do not include all of the information and footnotes required by accounting principles generally accepted in the United States (“GAAP”) for complete financial statements. In the opinion of management, these statements include all adjustments (consisting only of normal, recurring adjustments) necessary for a fair presentation of the consolidated financial statements. The consolidated financial statements include the accounts of Hill and its wholly- and majority-owned subsidiaries. All intercompany balances and transactions have been eliminated in consolidation. The preparation of financial statements in conformity with GAAP requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amounts of revenues and expenses during the reporting period. Actual results could differ from those estimates. The interim operating results are not necessarily indicative of the results for a full year. |
Fair Value Measurements | Fair Value Measurements Fair value is the price that would be received from selling an asset or paid to transfer a liability in an orderly transaction between market participants at the measurement date. When determining fair value, the Company considers the principal or most advantageous market in which it would transact, and the Company considers assumptions that market participants would use when pricing the asset or liability. It measures certain financial and nonfinancial assets and liabilities at fair value on a recurring and nonrecurring basis. Nonfinancial assets and liabilities include items such as goodwill and long lived assets that are measured at fair value resulting from impairment, if deemed necessary. During the nine months ended September 30, 2015 and 2014, the Company did not record any fair value adjustments to those financial and nonfinancial assets and liabilities measured at fair value on a recurring or nonrecurring basis. |
Restatement and Revision of P27
Restatement and Revision of Previously Reported Consolidated Financial Statements (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Restatement and Revision of Previously Reported Consolidated Financial Statements | |
Schedule of corrections of the misstatement on the Company?s consolidated balance sheets and consolidated statements of income, comprehensive income (loss) and cash flows | Nine Months Ended September 30, 2014 As Previously Reported Adjustment As Restated Consolidated Statement of Operations Consulting fee revenue $ $ — $ Reimbursable expenses — Total revenue — Cost of Services — Reimbursable expenses — Total direct costs — Gross profit — Selling, general and administrative expenses ) Operating profit Interest and related financing fees, net — Earnings (loss) before income taxes ) Income tax expense ) Net loss ) ) Less: net earnings - noncontrolling interests — Net loss attributable to Hill International, Inc. $ ) $ $ ) Basic loss per common share - Hill International, Inc. $ ) $ $ ) Diluted loss per common share _ Hill International, Inc. $ ) $ $ ) Nine Months Ended September 30, 2014 Consolidated Statement of Comprehensive Loss Net loss $ ) $ $ ) Foreign currency translation adjustment, net ) ) Other, net — Comprehensive loss ) ) Comprehensive loss attributable to noncontrolling interests — Comprehensive loss attributable to Hill International, Inc. $ ) $ $ ) Nine Months Ended September 30, 2014 Consolidated Statement of Cash Flows Net Loss $ ) $ $ ) Depreciation and amortization — Provision for bad debts — Interest accretion on term loan — Deferred tax expense ) ) ) Share based compensation — Restricted cash — Accounts receivable ) ) ) Accounts receivable - affiliate ) — ) Prepaid expenses and other current assets — Income taxes receivable — Retainage receivable ) — ) Other assets — Accounts payable and accrued expenses ) ) Income taxes payable ) — ) Deferred revenue ) — ) Other current liabilities ) — ) Retainage payable — Other liabilities ) — ) Net cash used in operations ) — ) Investing activities Net cash used in investing activities ) — ) Financing activities Net cash provided by financing activities — Effect of exchange rate changes on cash ) — ) Net decrease in cash and cash equivalents ) — ) Cash and cash equivalents - beginning of period — Cash and cash equivalents - end of period $ $ — $ |
Accounts Receivable (Tables)
Accounts Receivable (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Accounts Receivable. | |
Components of accounts receivable | The components of accounts receivable are as follows (in thousands): September 30, 2015 December 31, 2014 Billed $ $ Retainage, current portion Unbilled Allowance for doubtful accounts ) ) $ $ |
Intangible Assets (Tables)
Intangible Assets (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Intangible Assets | |
Summary of acquired intangible assets | The following table summarizes the Company’s acquired intangible assets (in thousands): September 30, 2015 December 31, 2014 Gross Gross Carrying Accumulated Carrying Accumulated Amount Amortization Amount Amortization Client relationships $ $ $ $ Acquired contract rights Trade names Total $ $ $ $ Intangible assets, net $ $ |
Summary of amortization expense related to intangible assets | Amortization expense related to intangible assets was as follows (in thousands): Three Months Ended September 30, Nine Months Ended September 30, 2015 2014 2015 2014 $ $ $ $ |
Estimated amortization expense of intangible assets for the next five years | The following table presents the estimated amortization expense based on our present intangible assets for the next five years (in thousands): Estimated Amortization Year Ending December 31, Expense 2015 (remaining 3 months) $ 2016 2017 2018 2019 |
Goodwill (Tables)
Goodwill (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Goodwill | |
Summary of changes in the company's carrying value of goodwill | The following table summarizes the changes in the Company’s carrying value of goodwill during 2015 (in thousands): Project Construction Management Claims Total Balance, December 31, 2014 $ $ $ Additions — Translation adjustments ) ) ) Balance, September 30, 2015 $ $ $ |
Accounts Payable and Accrued 31
Accounts Payable and Accrued Expenses (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Accounts Payable and Accrued Expenses | |
Components of accounts payable and accrued expenses | Below are the components of accounts payable and accrued expenses (in thousands): September 30, 2015 December 31, 2014 Accounts payable $ $ Accrued payroll Accrued subcontractor fees Accrued agency fees Accrued legal and professional fees Other accrued expenses $ $ |
Notes Payable and Long-Term D32
Notes Payable and Long-Term Debt (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Notes Payable and Long-Term Debt | |
Summary of outstanding debt obligations | Outstanding debt obligations are as follows (in thousands): September 30, 2015 December 31, 2014 Term Loan Facility $ $ Domestic Revolving Credit Facility International Revolving Credit Facility Borrowings under revolving credit facilities with a consortium of banks in Spain Borrowing under unsecured credit facility with Ibercaja Bank in Spain Borrowing from Philadelphia Industrial Development Corporation — Other notes payable — Less current maturities Notes payable and long-term debt, net of current maturities $ $ |
Schedule of requirements for the Maximum Consolidated Net Leverage Ratio And Actual Ratio | Not to exceed Actual 3.25 to 1.00 3.03 to 1.00 |
Supplemental Cash Flow Inform33
Supplemental Cash Flow Information (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Supplemental Cash Flow Information | |
Schedule of additional cash flow information | The following table provides additional cash flow information (in thousands): Nine Months Ended September 30, 2015 2014 Interest and related financing fees paid $ $ Income taxes paid $ $ Increase in property and equipment from a tenant improvement allowance related to the relocation of the corporate headquarters $ $ — Reduction of noncontrolling interest in connection with acquisition of an additional interest in Engineering S.A. $ ) $ ) Increase in additional paid in capital from issuance of shares of common stock related to purchase of CPI $ $ Increase in additional paid in capital from issuance of shares of common stock from cashless exercise of stock options $ $ |
Stockholders' Equity (Tables)
Stockholders' Equity (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Stockholders' Equity | |
Summary of changes in stockholders' equity | The following table summarizes the changes in stockholders’ equity during the nine months ended September 30, 2015 (in thousands): Hill International, Noncontrolling Total Inc. Stockholders Interests Stockholders’ equity, December 31, 2014 $ $ $ Net earnings Other comprehensive (loss) ) ) ) Comprehensive earnings (loss) ) ) ) Additional paid in capital — Acquisition of treasury stock ) ) — Adjustment related to ESA put options — ) Stock issued for acquisition of CPI — Stockholders’ equity, September 30, 2015 $ $ $ |
Income Taxes (Tables)
Income Taxes (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Income Taxes | |
Schedule of components of earnings (loss) before income taxes by United States and foreign jurisdictions | The components of earnings (loss) before income taxes and the related income tax expense by United States and foreign jurisdictions were as follows (in thousands): Three Months Ended September 30, 2015 Three Months Ended September 30, 2014 U.S. Foreign Total U.S. Foreign Total Earnings (loss) before income taxes $ ) $ $ $ ) $ $ ) Income tax expense, net $ — $ $ $ — $ $ Nine Months Ended September 30, 2015 Nine Months Ended September 30, 2014 U.S. Foreign Total U.S. Foreign Total (Restated) (Restated) Earnings (loss) before income taxes $ ) $ $ $ ) $ $ Income tax expense, net $ — $ $ $ — $ $ |
Business Segment Information (T
Business Segment Information (Tables) | 9 Months Ended |
Sep. 30, 2015 | |
Business Segment Information | |
Consulting Fee Revenue and Total Revenue | Consulting Fee Revenue (“CFR”) Three Months Ended September 30, 2015 2014 Project Management $ % $ % Construction Claims Total $ % $ % Total Revenue Three Months Ended September 30, 2015 2014 Project Management $ % $ % Construction Claims Total $ % $ % Consulting Fee Revenue (“CFR”) Nine Months Ended September 30, 2015 2014 Project Management $ % $ % Construction Claims Total $ % $ % Total Revenue Nine Months Ended September 30, 2015 2014 Project Management $ % $ % Construction Claims Total $ % $ % |
Operating Profit | Operating Profit Three Months Ended September 30, 2015 2014 Project Management before equity in loss of affiliate $ $ Equity in loss of affiliate ) — Total Project Management Construction Claims Corporate ) ) Total $ $ Operating Profit Nine Months Ended September 30, 2015 2014 (Restated) Project Management $ $ Equity in loss of affiliate ) — Total Project Management Construction Claims Corporate ) ) Total $ $ |
Depreciation and Amortization Expense | Depreciation and Amortization Expense Three Months Ended September 30, 2015 2014 Project Management $ $ Construction Claims Subtotal segments Corporate Total $ $ Depreciation and Amortization Expense Nine Months Ended September 30, 2015 2014 Project Management $ $ Construction Claims Subtotal segments Corporate Total $ $ |
Consulting Fee Revenue and Total Revenue by Geographic Region | Consulting Fee Revenue by Geographic Region Three Months Ended September 30, 2015 2014 U.S./Canada $ % $ % Latin America Europe Middle East Africa Asia/Pacific Total $ % $ % U.S. $ % $ % Non-U.S. Total $ % $ % Total Revenue by Geographic Region Three Months Ended September 30, 2015 2014 U.S./Canada $ % $ % Latin America Europe Middle East Africa Asia/Pacific Total $ % $ % U.S. $ % $ % Non-U.S. Total $ % $ % Consulting Fee Revenue by Geographic Region Nine Months Ended September 30, 2015 2014 U.S./Canada $ % $ % Latin America Europe Middle East Africa Asia/Pacific Total $ % $ % U.S. $ % $ % Non-U.S. Total $ % $ % Total Revenue by Geographic Region Nine Months Ended September 30, 2015 2014 U.S./Canada $ % $ % Latin America Europe Middle East Africa Asia/Pacific Total $ % $ % U.S. $ % $ % Non-U.S. Total $ % $ % |
Consulting Fee Revenue and Total Revenue By Client Type | Consulting Fee Revenue By Client Type Three Months Ended September 30, 2015 2014 U.S. federal government $ % $ % U.S. state, regional and local governments Foreign governments Private sector Total $ % $ % Total Revenue By Client Type Three Months Ended September 30, 2015 2014 U.S. federal government $ % $ % U.S. state, regional and local governments Foreign governments Private sector Total $ % $ % Consulting Fee Revenue By Client Type Nine Months Ended September 30, 2015 2014 U.S. federal government $ % $ % U.S. state, regional and local governments Foreign governments Private sector Total $ % $ % Total Revenue By Client Type Nine Months Ended September 30, 2015 2014 U.S. federal government $ % $ % U.S. state, regional and local governments Foreign governments Private sector Total $ % $ % |
Property, Plant and Equipment, Net by Geographic Location | Property, Plant and Equipment, Net by Geographic Location September 30, 2015 December 31, 2014 U.S./Canada $ $ Latin America Europe Middle East Africa Asia/Pacific Total $ $ U.S. $ $ Non-U.S. Total $ $ |
Restatement and Revision of P37
Restatement and Revision of Previously Reported Consolidated Financial Statements (Details) - USD ($) | 3 Months Ended | 9 Months Ended | 12 Months Ended | |||||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | Dec. 31, 2011 | |
Restatement and Revision of Previously Reported Consolidated Financial Statements | ||||||||
Provision for Doubtful Accounts | $ 2,540,000 | $ 1,501,000 | ||||||
Selling, general and administrative expenses | $ 57,527,000 | $ 51,352,000 | 173,101,000 | 151,677,000 | ||||
Net earnings (loss) | 3,336,000 | $ (8,615,000) | 8,720,000 | (1,051,000) | ||||
Adjustment | ||||||||
Restatement and Revision of Previously Reported Consolidated Financial Statements | ||||||||
Selling, general and administrative expenses | (4,948,000) | |||||||
Net earnings (loss) | 5,255,000 | |||||||
Libya | ||||||||
Restatement and Revision of Previously Reported Consolidated Financial Statements | ||||||||
Accounts receivable - Libya | $ 49,275,000 | 49,275,000 | $ 59,937,000 | |||||
Promised receivable which never materialized | $ 31,600,000 | |||||||
Provision for Doubtful Accounts | 59,937,000 | |||||||
Collection amount applied to receivables | $ 6,631,000 | $ 6,631,000 | $ 2,880,000 | |||||
Agency fees and taxes | 1,638,000 | 640,000 | ||||||
Selling, general and administrative expense | Libya | Adjustment | ||||||||
Restatement and Revision of Previously Reported Consolidated Financial Statements | ||||||||
Selling, general and administrative expenses | $ (4,948,000) | $ (2,240,000) | 48,549,000 | |||||
Net Loss | Adjustment | ||||||||
Restatement and Revision of Previously Reported Consolidated Financial Statements | ||||||||
Net earnings (loss) | $ (307,000) | |||||||
Eliminations | Libya | ||||||||
Restatement and Revision of Previously Reported Consolidated Financial Statements | ||||||||
Net assets | $ 11,388,000 |
Restatement and Revision of P38
Restatement and Revision of Previously Reported Consolidated Financial Statements (Details 2) - USD ($) $ / shares in Units, $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
Consulting fee revenue | $ 158,579 | $ 145,324 | $ 469,458 | $ 427,088 |
Reimbursable expenses | 20,356 | 16,167 | 61,393 | 44,055 |
Total revenue | 178,935 | 161,491 | 530,851 | 471,143 |
Cost of services | 89,345 | 82,675 | 268,174 | 244,511 |
Reimbursable expenses | 20,356 | 16,167 | 61,393 | 44,055 |
Total direct expenses | 109,701 | 98,842 | 329,567 | 288,566 |
Gross profit | 69,234 | 62,649 | 201,284 | 182,577 |
Selling, general and administrative expenses | 57,527 | 51,352 | 173,101 | 151,677 |
Operating Profit | 11,693 | 11,297 | 27,952 | 30,900 |
Interest expense and related financing fees, net | 4,147 | 16,112 | 11,252 | 26,834 |
Earnings (loss) before income taxes | 7,546 | (4,815) | 16,700 | 4,066 |
Income tax expense | 4,210 | 3,800 | 7,980 | 5,117 |
Net earnings (loss) | 3,336 | (8,615) | 8,720 | (1,051) |
Less: net earnings - noncontrolling interests | 388 | 351 | 675 | 1,089 |
Net earnings (loss) attributable to Hill International, Inc | $ 2,948 | $ (8,966) | $ 8,045 | $ (2,140) |
Basic loss per common share - Hill International, Inc. | $ 0.06 | $ (0.19) | $ 0.16 | $ (0.05) |
Diluted loss per common share - Hill International, Inc. | $ 0.06 | $ (0.19) | $ 0.16 | $ (0.05) |
As Previously Reported | ||||
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
Consulting fee revenue | $ 427,088 | |||
Reimbursable expenses | 44,055 | |||
Total revenue | 471,143 | |||
Cost of services | 244,511 | |||
Reimbursable expenses | 44,055 | |||
Total direct expenses | 288,566 | |||
Gross profit | 182,577 | |||
Selling, general and administrative expenses | 156,625 | |||
Operating Profit | 25,952 | |||
Interest expense and related financing fees, net | 26,834 | |||
Earnings (loss) before income taxes | (882) | |||
Income tax expense | 5,424 | |||
Net earnings (loss) | (6,306) | |||
Less: net earnings - noncontrolling interests | 1,089 | |||
Net earnings (loss) attributable to Hill International, Inc | $ (7,395) | |||
Basic loss per common share - Hill International, Inc. | $ (0.17) | |||
Diluted loss per common share - Hill International, Inc. | $ (0.17) | |||
Adjustment | ||||
CONSOLIDATED STATEMENTS OF OPERATIONS | ||||
Selling, general and administrative expenses | $ (4,948) | |||
Operating Profit | 4,948 | |||
Earnings (loss) before income taxes | 4,948 | |||
Income tax expense | (307) | |||
Net earnings (loss) | 5,255 | |||
Net earnings (loss) attributable to Hill International, Inc | $ 5,255 | |||
Basic loss per common share - Hill International, Inc. | $ 0.12 | |||
Diluted loss per common share - Hill International, Inc. | $ 0.12 |
Restatement and Revision of P39
Restatement and Revision of Previously Reported Consolidated Financial Statements (Details 3) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS | ||||
Net earnings (loss) | $ 3,336 | $ (8,615) | $ 8,720 | $ (1,051) |
Foreign currency translation adjustment, net of tax | (8,630) | (2,759) | (15,910) | (210) |
Other, net | (78) | (238) | (213) | 184 |
Comprehensive loss | (5,372) | (11,612) | (7,403) | (1,077) |
Comprehensive loss attributable to noncontrolling interests | (2,992) | (598) | (6,728) | 327 |
Comprehensive loss attributable to Hill International, Inc. | $ (2,380) | $ (11,014) | $ (675) | (1,404) |
As Previously Reported | ||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS | ||||
Net earnings (loss) | (6,306) | |||
Foreign currency translation adjustment, net of tax | (1,651) | |||
Other, net | 184 | |||
Comprehensive loss | (7,773) | |||
Comprehensive loss attributable to noncontrolling interests | 327 | |||
Comprehensive loss attributable to Hill International, Inc. | (8,100) | |||
Adjustment | ||||
CONSOLIDATED STATEMENTS OF COMPREHENSIVE EARNINGS | ||||
Net earnings (loss) | 5,255 | |||
Foreign currency translation adjustment, net of tax | 1,441 | |||
Comprehensive loss | 6,696 | |||
Comprehensive loss attributable to Hill International, Inc. | $ 6,696 |
Restatement and Revision of P40
Restatement and Revision of Previously Reported Consolidated Financial Statements (Details 4) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Operating activities: | ||||
Net earnings (loss) | $ 3,336 | $ (8,615) | $ 8,720 | $ (1,051) |
Depreciation and amortization | 2,863 | 2,412 | 8,286 | 7,276 |
Provision for bad debts | 2,540 | 1,501 | ||
Interest accretion on term loan | 15,526 | |||
Deferred tax expense | (1,585) | (2,623) | ||
Share based compensation | 2,360 | 2,712 | ||
Restricted cash | 10,658 | 3,716 | ||
Accounts receivable | (57,690) | (15,779) | ||
Accounts receivable - affiliate | (2,830) | (1,648) | ||
Prepaid expenses and other current assets | (4,556) | 2,381 | ||
Income taxes receivable | 25 | 589 | ||
Retainage receivable | 150 | (1,132) | ||
Other assets | 2,342 | 1,065 | ||
Accounts payable and accrued expenses | 15,194 | (3,524) | ||
Income taxes payable | 1,455 | (2,603) | ||
Deferred revenue | 589 | (7,610) | ||
Other current liabilities | 7,398 | (2,711) | ||
Retainage payable | 474 | 1,166 | ||
Other liabilities | 2,878 | (3,599) | ||
Net cash used in operating activities | (3,592) | (6,348) | ||
Investing activities | ||||
Net cash used in investing activities | (15,831) | (2,393) | ||
Financing activities | ||||
Net cash provided by financing activities | 15,039 | 9,316 | ||
Effect of exchange rate changes on cash | (1,839) | (2,431) | ||
Net increase (decrease) in cash and cash equivalents | (6,223) | (1,856) | ||
Cash and cash equivalents - beginning of period | 30,124 | 30,381 | ||
Cash and cash equivalents - end of period | $ 23,901 | 28,525 | $ 23,901 | 28,525 |
As Previously Reported | ||||
Operating activities: | ||||
Net earnings (loss) | (6,306) | |||
Depreciation and amortization | 7,276 | |||
Provision for bad debts | 1,501 | |||
Interest accretion on term loan | 15,526 | |||
Deferred tax expense | (2,316) | |||
Share based compensation | 2,712 | |||
Restricted cash | 3,716 | |||
Accounts receivable | (9,148) | |||
Accounts receivable - affiliate | (1,648) | |||
Prepaid expenses and other current assets | 2,381 | |||
Income taxes receivable | 589 | |||
Retainage receivable | (1,132) | |||
Other assets | 1,065 | |||
Accounts payable and accrued expenses | (5,207) | |||
Income taxes payable | (2,603) | |||
Deferred revenue | (7,610) | |||
Other current liabilities | (2,711) | |||
Retainage payable | 1,166 | |||
Other liabilities | (3,599) | |||
Net cash used in operating activities | (6,348) | |||
Investing activities | ||||
Net cash used in investing activities | (2,393) | |||
Financing activities | ||||
Net cash provided by financing activities | 9,316 | |||
Effect of exchange rate changes on cash | (2,431) | |||
Net increase (decrease) in cash and cash equivalents | (1,856) | |||
Cash and cash equivalents - beginning of period | 30,381 | |||
Cash and cash equivalents - end of period | $ 28,525 | 28,525 | ||
Adjustment | ||||
Operating activities: | ||||
Net earnings (loss) | 5,255 | |||
Deferred tax expense | (307) | |||
Accounts receivable | (6,631) | |||
Accounts payable and accrued expenses | $ 1,683 |
The Company (Details)
The Company (Details) | 9 Months Ended |
Sep. 30, 2015division | |
The Company | |
Number of key operating divisions | 2 |
Acquisitions (Details)
Acquisitions (Details) | Oct. 31, 2015GBP (£) | Oct. 31, 2015USD ($) | Oct. 06, 2015USD ($)shares | May. 12, 2015TRY | May. 12, 2015USD ($) | Apr. 15, 2015TRYitem | Apr. 15, 2015USD ($) | Dec. 23, 2014GBP (£) | Dec. 23, 2014USD ($) | Nov. 25, 2014GBP (£) | Nov. 25, 2014USD ($) | Oct. 31, 2014GBP (£)item | Oct. 31, 2014USD ($)item | Aug. 31, 2015shares | Apr. 30, 2015BRLshareholder | Sep. 30, 2015GBP (£) | Sep. 30, 2015USD ($) | Sep. 30, 2015TRY | Sep. 30, 2015GBP (£) | Sep. 30, 2015USD ($) | Apr. 15, 2015USD ($)item | Apr. 04, 2015USD ($) | Dec. 31, 2014USD ($) | Oct. 31, 2014USD ($)item |
Acquisitions | ||||||||||||||||||||||||
Goodwill. | $ | $ 75,212,000 | $ 80,437,000 | ||||||||||||||||||||||
ESA | ||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||
Number of Minority Shareholders who Exercised Put Option | shareholder | 2 | |||||||||||||||||||||||
Minority shareholders ownership percentage | 19.00% | |||||||||||||||||||||||
Premium on common stock (as a percent) | 25.00% | |||||||||||||||||||||||
Consideration requested by sellers | $ | $ 4,374,000 | |||||||||||||||||||||||
Days share price is guaranteed after sale of stock | 30 days | |||||||||||||||||||||||
Shares issued as part of counter offer | shares | 924,736 | |||||||||||||||||||||||
Ownership interest acquired (as a percent) | 91.00% | 91.00% | 91.00% | |||||||||||||||||||||
Contingent consideration | BRL 10,645,000 | $ 3,416,000 | ||||||||||||||||||||||
ESA | Forecast | Subsequent event | ||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||
Treasury stock acquired | shares | 129,648 | |||||||||||||||||||||||
Consideration for acquisition | $ | $ 580,000 | |||||||||||||||||||||||
IMS | ||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||
Number of professionals | item | 80 | 80 | ||||||||||||||||||||||
Consideration for acquisition | TRY 12,411,000 | $ 4,640,000 | ||||||||||||||||||||||
Cash payment | TRY 8,272,000 | $ 3,145,000 | 4,139,000 | 1,547,000 | ||||||||||||||||||||
Acquisition consideration payable | 4,400,000 | 1,626,000 | ||||||||||||||||||||||
Contingent consideration | TRY 6,100,000 | 2,255,000 | ||||||||||||||||||||||
Intangible assets acquired | 10,575,000 | $ 3,953,000 | ||||||||||||||||||||||
Goodwill. | TRY 9,421,000 | $ 3,522,000 | ||||||||||||||||||||||
Weighted average life of acquired intangible assets | 7 years | 7 years | ||||||||||||||||||||||
IMS | Client relationship | ||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||
Intangible assets acquired | TRY 6,235,000 | $ 2,331,000 | ||||||||||||||||||||||
Weighted average life of acquired intangible assets | 10 years | 10 years | ||||||||||||||||||||||
IMS | Trade names | ||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||
Intangible assets acquired | TRY 434,000 | $ 162,000 | ||||||||||||||||||||||
Weighted average life of acquired intangible assets | 2 years | 2 years | ||||||||||||||||||||||
IMS | Acquired contract rights | ||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||
Intangible assets acquired | TRY 3,906,000 | $ 1,460,000 | ||||||||||||||||||||||
Weighted average life of acquired intangible assets | 2 years 7 months 6 days | 2 years 7 months 6 days | ||||||||||||||||||||||
IMS | Other Current Liabilities | ||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||
Contingent consideration | 4,400,000 | 1,627,000 | ||||||||||||||||||||||
IMS | Other Liabilities | ||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||
Contingent consideration | TRY 1,700,000 | $ 628,000 | ||||||||||||||||||||||
IMS | EBITDA Target 1 | ||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||
Contingent consideration | TRY 1,700,000 | 628,000 | ||||||||||||||||||||||
IMS | EBITDA Target 1 | Minimum | ||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||
EBITDA Target | 3,500,000 | 1,294,000 | ||||||||||||||||||||||
IMS | EBITDA Target 2 | ||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||
Contingent consideration | 1,500,000 | 554,000 | ||||||||||||||||||||||
IMS | EBITDA Target 2 | Minimum | ||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||
EBITDA Target | 3,200,000 | $ 1,183,000 | ||||||||||||||||||||||
IMS | EBITDA Target 2 | Maximum | ||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||
EBITDA Target | TRY | TRY 3,500,000 | |||||||||||||||||||||||
Cadogans | ||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||
Cash payment | £ 579,000 | $ 894,000 | ||||||||||||||||||||||
Acquisition consideration payable | 600,000 | |||||||||||||||||||||||
Contingent consideration | £ 200,000 | |||||||||||||||||||||||
Contingent consideration arrangement, evaluation period | 2 years | 2 years | ||||||||||||||||||||||
Contingent consideration, minimum | £ 0 | |||||||||||||||||||||||
Hill International (UK) Ltd | Cadogans | ||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||
Number of professionals | item | 27 | 27 | ||||||||||||||||||||||
Consideration for acquisition | £ 2,719,000 | $ 4,350,000 | ||||||||||||||||||||||
Cash payment | £ 400,000 | $ 640,000 | £ 600,000 | $ 960,000 | 1,000,000 | $ 1,600,000 | ||||||||||||||||||
Acquisition consideration payable | £ 719,000 | $ 1,090,000 | ||||||||||||||||||||||
Contingent consideration | £ 200,000 | |||||||||||||||||||||||
Contingent consideration arrangement, evaluation period | 2 years | 2 years | ||||||||||||||||||||||
Contingent consideration, minimum | £ 0 | |||||||||||||||||||||||
Number Of Selling Shareholders | item | 2 | 2 | ||||||||||||||||||||||
Number Of Annual Installments | item | 5 | 5 | ||||||||||||||||||||||
Maximum annual earn out installment | 100,000 | 152,000 | ||||||||||||||||||||||
EBITDA Target | £ 396,000 | $ 600,000 | ||||||||||||||||||||||
Hill International (UK) Ltd | Cadogans | Other Current Liabilities | ||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||
Acquisition consideration payable | 519,000 | 787,000 | ||||||||||||||||||||||
Hill International (UK) Ltd | Cadogans | Other Liabilities | ||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||
Acquisition consideration payable | £ 200,000 | $ 303,000 | ||||||||||||||||||||||
Hill International (UK) Ltd | Cadogans | Forecast | Subsequent event | ||||||||||||||||||||||||
Acquisitions | ||||||||||||||||||||||||
Cash payment | £ 519,000 | $ 830,000 |
Accounts Receivable (Details)
Accounts Receivable (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Components of accounts receivable | ||
Billed | $ 240,589 | $ 210,460 |
Retainage, current portion | 14,802 | 12,700 |
Unbilled | 40,715 | 32,739 |
Accounts receivable, gross | 296,106 | 255,899 |
Allowance for doubtful accounts | (59,282) | (60,801) |
Total | $ 236,824 | $ 195,098 |
Accounts Receivable (Details 2)
Accounts Receivable (Details 2) - Libya - USD ($) | 9 Months Ended | 12 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | Dec. 31, 2013 | Dec. 31, 2012 | |
Accounts Receivable | |||||
Accounts receivable - Libya | $ 49,275,000 | $ 59,937,000 | |||
Collection amount applied to receivables | $ 6,631,000 | $ 6,631,000 | $ 2,880,000 | ||
Decrease due to foreign exchange losses | $ 1,151,000 |
Intangible Assets (Details)
Intangible Assets (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Summary of acquired intangible assets | ||
Gross Carrying Amount | $ 50,071 | $ 50,822 |
Accumulated Amortization | 33,990 | 31,540 |
Intangible assets, net | 16,081 | 19,282 |
Client relationship | ||
Summary of acquired intangible assets | ||
Gross Carrying Amount | 34,966 | 36,412 |
Accumulated Amortization | 21,906 | 20,758 |
Acquired contract rights | ||
Summary of acquired intangible assets | ||
Gross Carrying Amount | 12,370 | 11,387 |
Accumulated Amortization | 10,912 | 9,717 |
Trade names | ||
Summary of acquired intangible assets | ||
Gross Carrying Amount | 2,735 | 3,023 |
Accumulated Amortization | $ 1,172 | $ 1,065 |
Intangible Assets (Details 2)
Intangible Assets (Details 2) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Intangible Assets | ||||
Amortization expense related to intangible assets | $ 1,578 | $ 1,518 | $ 4,609 | $ 4,650 |
Estimated amortization expense of intangible assets for the next five years | ||||
2015 (remaining 3 months) | 1,455 | 1,455 | ||
2,016 | 4,339 | 4,339 | ||
2,017 | 3,055 | 3,055 | ||
2,018 | 1,953 | 1,953 | ||
2,019 | $ 1,679 | $ 1,679 |
Goodwill (Details)
Goodwill (Details) $ in Thousands | 9 Months Ended |
Sep. 30, 2015USD ($) | |
Summary of changes in carrying value of goodwill during 2015 | |
Balance at the beginning of the period | $ 80,437 |
Additions | 3,783 |
Translation adjustments | (9,008) |
Balance at the end of the period | 75,212 |
Project Management | |
Summary of changes in carrying value of goodwill during 2015 | |
Balance at the beginning of the period | 53,669 |
Additions | 3,783 |
Translation adjustments | (7,657) |
Balance at the end of the period | 49,795 |
Construction Claims | |
Summary of changes in carrying value of goodwill during 2015 | |
Balance at the beginning of the period | 26,768 |
Translation adjustments | (1,351) |
Balance at the end of the period | $ 25,417 |
Accounts Payable and Accrued 48
Accounts Payable and Accrued Expenses (Details) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Components of accounts payable and accrued expenses | ||
Accounts payable | $ 33,640 | $ 32,701 |
Accrued payroll | 47,450 | 41,205 |
Accrued subcontractor fees | 7,642 | 3,930 |
Accrued agency fees | 5,875 | 6,920 |
Accrued legal and professional fees | 2,934 | 1,099 |
Other accrued expenses | 5,769 | 7,782 |
Accounts payable and accrued expenses, net | $ 103,310 | $ 93,637 |
Notes Payable and Long-Term D49
Notes Payable and Long-Term Debt (Details) - USD ($) | Sep. 30, 2015 | Apr. 02, 2015 | Dec. 31, 2014 |
Summary of outstanding debt obligations | |||
Long-term Debt, Total | $ 143,474,000 | $ 128,236,000 | |
Less current maturities | 2,982,000 | 6,361,000 | |
Notes payable and long-term debt, net of current maturities | 140,492,000 | 121,875,000 | |
Loans | PIDC | |||
Summary of outstanding debt obligations | |||
Long-term Debt, Total | 723,000 | $ 750,000 | |
Term loan | |||
Summary of outstanding debt obligations | |||
Long-term Debt, Total | 118,800,000 | 119,700,000 | |
Revolving credit facility | Domestic Revolving Credit Facility | |||
Summary of outstanding debt obligations | |||
Long-term Debt, Total | 8,500,000 | 200,000 | |
Revolving credit facility | International Revolving Credit Facility | |||
Summary of outstanding debt obligations | |||
Long-term Debt, Total | 10,466,000 | 2,554,000 | |
Revolving credit facility | Consortium of banks in Spain | |||
Summary of outstanding debt obligations | |||
Long-term Debt, Total | 4,621,000 | 5,037,000 | |
Revolving credit facility | Ibercaja Bank In Spain | |||
Summary of outstanding debt obligations | |||
Long-term Debt, Total | 197,000 | $ 745,000 | |
Other notes payable | |||
Summary of outstanding debt obligations | |||
Long-term Debt, Total | $ 167,000 |
Notes Payable and Long-Term D50
Notes Payable and Long-Term Debt (Details 2 ) | Sep. 26, 2014USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2015EUR (€) | Sep. 30, 2015USD ($) | Dec. 31, 2014USD ($) | Sep. 26, 2014EUR (€) | Sep. 26, 2014USD ($) |
Other Foreign Banks | |||||||
Notes Payable and Long-Term Debt | |||||||
Maximum borrowing capacity | $ 80,163,000 | ||||||
US Dollar Revolver | LIBOR | |||||||
Notes Payable and Long-Term Debt | |||||||
Basis of effective interest rate (as a percent) | 3.75% | ||||||
US Dollar Revolver | Base Rate | |||||||
Notes Payable and Long-Term Debt | |||||||
Basis of effective interest rate (as a percent) | 2.75% | ||||||
International Revolver | EURIBOR | |||||||
Notes Payable and Long-Term Debt | |||||||
Basis of effective interest rate (as a percent) | 4.00% | ||||||
Secured Credit Facilities | |||||||
Notes Payable and Long-Term Debt | |||||||
Cash excluded from consolidated net leverage ratio | $ 10,000,000 | ||||||
Debt instrument increase in applicable interest rate for past due account receivable limit exceeded | 2.00% | 2.00% | |||||
Consolidated net leverage ratio not to exceed | 3.25 | ||||||
Actual net consolidated leverage ratio | 3.03 | ||||||
Increase in applicable interest rate upon default (as a percent) | 2.00% | ||||||
Deferred financing fees | $ 7,066,000 | ||||||
Term loan | |||||||
Notes Payable and Long-Term Debt | |||||||
Aggregate principal amount | $ 120,000,000 | ||||||
Mandatory prepayment percentage of the excess cash flow for each fiscal year with the first full fiscal year upon the achievement and maintenance of certain metrics | 50.00% | ||||||
Mandatory prepayment percentage of the excess cash flow for each fiscal year with the first full fiscal year upon the achievement net leverage ration is equal to or less than 2.25 | 25.00% | ||||||
Consolidated net leverage limit for mandatory prepayment percentage of 25% | 2.25 | ||||||
Mandatory prepayment percentage of the excess cash flow for each fiscal year with the first full fiscal year upon the achievement net leverage ration is equal to or less than 1.50 | 0.00% | ||||||
Consolidated net leverage limit for mandatory prepayment percentage of 0% | 1.50 | ||||||
Term of debt | 6 years | ||||||
Quarterly principal payment, percentage | 0.25% | 0.25% | |||||
Debt issuance costs amortization term | 6 years | ||||||
Term loan | LIBOR | |||||||
Notes Payable and Long-Term Debt | |||||||
Basis of effective interest rate (as a percent) | 6.75% | ||||||
Term loan | LIBOR | Minimum | |||||||
Notes Payable and Long-Term Debt | |||||||
Variable interest rate basis floor (as a percent) | 1.00% | ||||||
Term loan | One Month LIBOR | Minimum | |||||||
Notes Payable and Long-Term Debt | |||||||
Basis of effective interest rate (as a percent) | 1.00% | ||||||
Term loan | Base Rate | |||||||
Notes Payable and Long-Term Debt | |||||||
Basis of effective interest rate (as a percent) | 5.75% | ||||||
Term loan | Federal Funds effective rate | |||||||
Notes Payable and Long-Term Debt | |||||||
Basis of effective interest rate (as a percent) | 0.50% | ||||||
Term loan | Other Assets. | |||||||
Notes Payable and Long-Term Debt | |||||||
Unamortized balances of expenses and fees | 5,888,000 | $ 6,772,000 | |||||
Revolving credit facility | |||||||
Notes Payable and Long-Term Debt | |||||||
Term of debt | 5 years | ||||||
Deferred financing fees | $ 3,000,000 | ||||||
Debt issuance costs amortization term | 5 years | ||||||
Revolving credit facility | US Dollar Revolver | |||||||
Notes Payable and Long-Term Debt | |||||||
Maximum borrowing capacity | 30,000,000 | $ 30,000,000 | |||||
Unused facility commitment fees percentage | 0.50% | ||||||
Revolving credit facility | International Revolver | |||||||
Notes Payable and Long-Term Debt | |||||||
Maximum borrowing capacity | € 11,795,000 | 13,240,000 | € 11,765,000 | 15,000,000 | |||
Unused facility commitment fees percentage | 0.75% | ||||||
Percentage of eligible receivables that are subject to a perfected security interest which are used in calculation of borrowing base | 85.00% | ||||||
Percentage of eligible receivables that are not subject to a perfected security interest which are used in calculation of borrowing base | 10.00% | ||||||
Revolving credit facility | International Revolver | Other Foreign Banks | Foreign credit agreements | |||||||
Notes Payable and Long-Term Debt | |||||||
Amounts outstanding | 1,881,000 | ||||||
Available borrowing capacity | 893,000 | ||||||
Revolving credit facility | Other Assets. | |||||||
Notes Payable and Long-Term Debt | |||||||
Unamortized balances of expenses and fees | 2,400,000 | $ 2,850,000 | |||||
Letters of credit | US Dollar Revolver | |||||||
Notes Payable and Long-Term Debt | |||||||
Maximum borrowing capacity | $ 25,000,000 | ||||||
Amounts outstanding | 9,286,000 | ||||||
Available borrowing capacity | $ 12,214,000 | ||||||
Letters of credit | International Revolver | |||||||
Notes Payable and Long-Term Debt | |||||||
Maximum borrowing capacity | € | € 8,000,000 | ||||||
Non Permitted Country | Secured Credit Facilities | Maximum | |||||||
Notes Payable and Long-Term Debt | |||||||
Percentage of receivables more than 120 days old | 10.00% | 10.00% | |||||
United Arab Emirates | Secured Credit Facilities | Maximum | |||||||
Notes Payable and Long-Term Debt | |||||||
Percentage of receivables more than 120 days old | 14.00% | 14.00% |
Notes Payable and Long-Term D51
Notes Payable and Long-Term Debt (Details 3) | Apr. 02, 2015USD ($)installment | Sep. 30, 2015EUR (€)item | Sep. 30, 2015USD ($) | Dec. 31, 2014EUR (€) | Dec. 31, 2014USD ($) |
Description of terms of credit agreement | |||||
Total debt | $ 143,474,000 | $ 128,236,000 | |||
PIDC | Loans | |||||
Description of terms of credit agreement | |||||
Total debt | $ 750,000 | 723,000 | |||
Interest rate (as a percent) | 2.75% | ||||
Number of installments | installment | 144 | ||||
Amount payable in each installment | $ 6,121 | ||||
Revolving credit facility | Consortium of banks in Spain | |||||
Description of terms of credit agreement | |||||
Total debt | 4,621,000 | $ 5,037,000 | |||
Hill Spain | Revolving credit facility | Consortium of banks in Spain | |||||
Description of terms of credit agreement | |||||
Total debt | € 3,986,000 | $ 4,486,000 | |||
Interest rate (as a percent) | 6.50% | 6.50% | |||
Number of banks involved in revolving credit facility | item | 6 | ||||
Borrowing capacity | € 4,005,000 | $ 4,507,000 | € 5,340,000 | ||
Hill Spain | Revolving credit facility | Consortium of banks in Spain | December 31, 2014 | |||||
Description of terms of credit agreement | |||||
Reduction in maximum available amount percentage | 75.00% | 75.00% | |||
Hill Spain | Revolving credit facility | Consortium of banks in Spain | December 31, 2015 | |||||
Description of terms of credit agreement | |||||
Reduction in maximum available amount percentage | 50.00% | 50.00% | |||
Hill Spain | Revolving credit facility | Consortium of banks in Spain | Minimum | |||||
Description of terms of credit agreement | |||||
Total amount being financed by Financing Entity | € 284,000 | $ 320,000 | |||
Hill Spain | Revolving credit facility | Consortium of banks in Spain | Maximum | |||||
Description of terms of credit agreement | |||||
Total amount being financed by Financing Entity | € 1,154,000 | $ 1,299,000 |
Notes Payable and Long-Term D52
Notes Payable and Long-Term Debt (Details 4) - 9 months ended Sep. 30, 2015 | USD ($)loanfacilityitem | AED | BRL | EUR (€) | USD ($) |
Description of terms of credit agreement | |||||
Payoff and termination of term loan | $ 27,000 | ||||
Other Foreign Banks | |||||
Description of terms of credit agreement | |||||
Maximum borrowing capacity | $ 80,163,000 | ||||
Letters of credit outstanding | 42,042,000 | ||||
Line of credit | National Bank of Abu Dhabi | |||||
Description of terms of credit agreement | |||||
Maximum borrowing capacity | AED 11,500,000 | $ 3,131,000 | |||
Amounts outstanding | AED | AED 0 | ||||
Line of credit | National Bank of Abu Dhabi | Emirates InterBank Offer Rate | |||||
Description of terms of credit agreement | |||||
Reference rate | one-month Emirates InterBank Offer Rate | ||||
Basis of effective interest rate (as a percent) | 3.00% | ||||
Effective interest rate (as a percent) | 4.41% | ||||
Line of credit | National Bank of Abu Dhabi | Emirates InterBank Offer Rate | Minimum | |||||
Description of terms of credit agreement | |||||
Interest rate (as a percent) | 5.50% | 5.50% | 5.50% | 5.50% | |
Letters of credit | National Bank of Abu Dhabi | |||||
Description of terms of credit agreement | |||||
Maximum borrowing capacity | AED 200,000,000 | $ 54,500,000 | |||
Amounts outstanding | AED 95,221,000 | 25,900,000 | |||
Hill Spain | Line of credit | Ibercaja Bank In Spain | |||||
Description of terms of credit agreement | |||||
Maximum borrowing capacity | € 175,000 | $ 197,000 | |||
Decrease in amount on quarterly basis | € | € 175,000 | ||||
Interest rate (as a percent) | 6.75% | 6.75% | 6.75% | 6.75% | |
Amounts outstanding | € | € 175,000 | ||||
Hill Spain | ICO loan | Bankia Bank | |||||
Description of terms of credit agreement | |||||
Maximum borrowing capacity | 120,000 | $ 135,000 | |||
Decrease in amount on quarterly basis | € | € 15,000 | ||||
Interest rate (as a percent) | 5.91% | 5.91% | 5.91% | 5.91% | |
Amounts outstanding | € | € 120,000 | ||||
Engineering S.A. | Revolving credit facility | |||||
Description of terms of credit agreement | |||||
Maximum borrowing capacity | BRL 2,220,000 | $ 542,000 | |||
Number of revolving credit lines maintained by Engineering S.A. | item | 4 | ||||
Number of banks involved in revolving credit facility | loanfacility | 2 | ||||
Weighted average interest rate (as a percent) | 3.69% | 3.69% | 3.69% | 3.69% | |
Period of automatic renewal | 3 months | ||||
Engineering S.A. | Line of credit | Brazil Bank Revolving Credit Facility 1 | |||||
Description of terms of credit agreement | |||||
Amounts outstanding | $ 0 |
Supplemental Cash Flow Inform53
Supplemental Cash Flow Information (Details) - USD ($) $ in Thousands | 9 Months Ended | |
Sep. 30, 2015 | Sep. 30, 2014 | |
Summary of additional cash flow information | ||
Interest and related financing fees paid | $ 9,067 | $ 19,662 |
Income taxes paid | 4,242 | 5,375 |
Increase in property and equipment from a tenant improvement allowance related to the relocation of the corporate headquarters | 3,894 | |
Additional Paid-in Capital | ||
Summary of additional cash flow information | ||
Increase in additional paid in capital from issuance of shares of common stock from cashless exercise of stock options | 361 | 538 |
Engineering S.A. | ||
Summary of additional cash flow information | ||
Reduction of noncontrolling interest in connection with acquisition of an additional interest | (4,374) | (2,649) |
CPI | Additional Paid-in Capital | ||
Summary of additional cash flow information | ||
Increase in additional paid in capital from issuance of shares of common stock | $ 530 | $ 618 |
Earnings per Share (Details)
Earnings per Share (Details) - shares | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Earnings per Share | ||||
Dilutive stock options (in shares) | 684,000 | 144,000 | 613,000 | 186,000 |
Total number of shares excluded from diluted (loss) earnings per common share | 3,208,000 | 7,437,000 | 3,773,000 | 7,460,000 |
Share-Based Compensation (Detai
Share-Based Compensation (Details) - USD ($) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Share-Based Compensation | ||||
Options outstanding (in shares) | 7,908,000 | 7,908,000 | ||
Weighted average exercise price of outstanding options (in dollars per share) | $ 4.40 | $ 4.40 | ||
Weighted average exercise price of options granted (in dollars per share) | $ 4.03 | |||
Weighted-average contractual life of options granted | 6 years 10 months 24 days | |||
Aggregate fair value of options granted (in dollars) | $ 2,221,000 | |||
Options exercised (in shares) | 139,000 | |||
Weighted average exercise price of options exercised (in dollars per share) | $ 3.59 | |||
Share-based compensation expense recognized (in dollars) | $ 899,000 | $ 785,000 | $ 2,360,000 | $ 2,712,000 |
Weighted average assumptions used to estimate the fair value of options granted | ||||
Average expected life | 4 years 10 months 24 days | |||
Volatility (as a percent) | 59.10% | |||
Weighted average risk-free interest rate (as a percent) | 1.45% | |||
Exercise price of 6.90 | ||||
Share-Based Compensation | ||||
Options lapsed (in shares) | 383,000 | |||
Weighted average exercise price of options lapsed (in dollars per share) | $ 6.90 | |||
Exercise price of 4.40 | ||||
Share-Based Compensation | ||||
Forfeited (in shares) | 28,000 | |||
Weighted average exercise price of options forfeited (in dollars per share) | $ 4.40 | |||
2008 Employee Stock Purchase Plan | ||||
Share-Based Compensation | ||||
Shares purchased | 18,000 | |||
Aggregate purchase price | $ 57,000 | |||
Options vesting over a five-year period | ||||
Share-Based Compensation | ||||
Options granted (in shares) | 1,035,000 | |||
Award vesting period | 5 years | |||
Options vested immediately | ||||
Share-Based Compensation | ||||
Options granted (in shares) | 63,000 |
Stockholders' Equity (Details)
Stockholders' Equity (Details) | 1 Months Ended | 3 Months Ended | 9 Months Ended | |||
May. 31, 2015director$ / sharesshares | Apr. 30, 2015shareholder | Sep. 30, 2015USD ($) | Sep. 30, 2014USD ($) | Sep. 30, 2015USD ($)$ / shares | Sep. 30, 2014USD ($) | |
Increase (decrease) in stockholders' equity | ||||||
Balance | $ 122,000,000 | |||||
Net earnings (loss) | $ 3,336,000 | $ (8,615,000) | 8,720,000 | $ (1,051,000) | ||
Other comprehensive (loss) | (16,123,000) | |||||
Comprehensive earnings (loss) | (7,403,000) | |||||
Additional paid in capital | 2,915,000 | |||||
Acquisition of treasury stock | (361,000) | |||||
Balance | 117,681,000 | $ 117,681,000 | ||||
Weighted average exercise price of options exercised (in dollars per share) | $ / shares | $ 3.59 | |||||
Cash proceeds received from the exercise of stock options | $ 137,000 | |||||
Hill International, Inc. Stockholders | ||||||
Increase (decrease) in stockholders' equity | ||||||
Balance | 113,288,000 | |||||
Net earnings (loss) | 8,045,000 | |||||
Other comprehensive (loss) | (13,094,000) | |||||
Comprehensive earnings (loss) | (5,049,000) | |||||
Additional paid in capital | 2,915,000 | |||||
Acquisition of treasury stock | (361,000) | |||||
Adjustment related to ESA Put Options | 4,374,000 | |||||
Balance | 115,697,000 | 115,697,000 | ||||
Noncontrolling Interests | ||||||
Increase (decrease) in stockholders' equity | ||||||
Balance | 8,712,000 | |||||
Net earnings (loss) | 675,000 | |||||
Other comprehensive (loss) | (3,029,000) | |||||
Comprehensive earnings (loss) | (2,354,000) | |||||
Adjustment related to ESA Put Options | (4,374,000) | |||||
Balance | $ 1,984,000 | 1,984,000 | ||||
Chairman and Chief Executive Officer | ||||||
Increase (decrease) in stockholders' equity | ||||||
Number of company's directors | director | 4 | |||||
Options exercised on a cashless basis (in shares) | shares | 84,868 | |||||
Weighted average exercise price of options exercised (in dollars per share) | $ / shares | $ 4.25 | |||||
Withheld shares as payment for the options (in shares) | shares | 67,400 | |||||
Shares received from transaction | shares | 17,468 | |||||
CPI | ||||||
Increase (decrease) in stockholders' equity | ||||||
Stock issued for acquisition of CPI | 530,000 | |||||
CPI | Hill International, Inc. Stockholders | ||||||
Increase (decrease) in stockholders' equity | ||||||
Stock issued for acquisition of CPI | $ 530,000 | |||||
ESA | ||||||
Increase (decrease) in stockholders' equity | ||||||
Number of Minority Shareholders who Exercised Put Option | shareholder | 2 | |||||
Noncontrolling Interest, Ownership Percentage by Parent | 19.00% |
Income Taxes (Details)
Income Taxes (Details) - USD ($) | 3 Months Ended | 9 Months Ended | |||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | Dec. 31, 2014 | |
Effective income tax rate (as a percent) | 55.80% | (78.90%) | 47.80% | 125.80% | |
Change in reserve due to tax positions taken in foreign jurisdictions | $ 0 | $ 0 | $ 245,000 | ||
Reduction in reserve for effectively settled with the appropriate foreign tax authorities | 0 | 2,514,000 | $ 2,514,000 | ||
Income tax expense (benefit) resulting from adjustments | (37,000) | 206,000 | (37,000) | 250,000 | |
Components of earnings (loss) before income taxes | |||||
Earnings (Loss) before income taxes | 7,546,000 | (4,815,000) | 16,700,000 | 4,066,000 | |
Income tax expense, net | 4,210,000 | 3,800,000 | 7,980,000 | 5,117,000 | |
Reserve for uncertain tax positions | 1,220,000 | 1,220,000 | $ 975,000 | ||
Increase in reserve for uncertain tax positions related to tax positions taken in foreign jurisdictions | 420,000 | ||||
Potential interest and penalties related to uncertain tax positions | 520,000 | 520,000 | $ 592,000 | ||
Federal | |||||
Components of earnings (loss) before income taxes | |||||
Earnings (Loss) before income taxes | (2,541,000) | (16,640,000) | (22,529,000) | (32,137,000) | |
Foreign Tax | |||||
Components of earnings (loss) before income taxes | |||||
Earnings (Loss) before income taxes | 10,087,000 | 11,825,000 | 39,229,000 | 36,203,000 | |
Income tax expense, net | $ 4,210,000 | $ 3,800,000 | $ 7,980,000 | $ 5,117,000 |
Business Segment Information (D
Business Segment Information (Details) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Revenue | ||||
Consulting Fee Revenue | $ 158,579 | $ 145,324 | $ 469,458 | $ 427,088 |
Consulting fee revenue (as a percent) | 100.00% | 100.00% | 100.00% | 100.00% |
Total Revenue | $ 178,935 | $ 161,491 | $ 530,851 | $ 471,143 |
Total revenue (as a percent) | 100.00% | 100.00% | 100.00% | 100.00% |
Project Management | ||||
Revenue | ||||
Consulting Fee Revenue | $ 116,541 | $ 106,969 | $ 345,122 | $ 317,278 |
Consulting fee revenue (as a percent) | 73.50% | 73.60% | 73.50% | 74.30% |
Total Revenue | $ 135,539 | $ 121,746 | $ 402,586 | $ 356,959 |
Total revenue (as a percent) | 75.70% | 75.40% | 75.80% | 75.80% |
Construction Claims | ||||
Revenue | ||||
Consulting Fee Revenue | $ 42,038 | $ 38,355 | $ 124,336 | $ 109,810 |
Consulting fee revenue (as a percent) | 26.50% | 26.40% | 26.50% | 25.70% |
Total Revenue | $ 43,396 | $ 39,745 | $ 128,265 | $ 114,184 |
Total revenue (as a percent) | 24.30% | 24.60% | 24.20% | 24.20% |
Business Segment Information 59
Business Segment Information (Details 2) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Operating Profit | ||||
Operating Profit | $ 11,693 | $ 11,297 | $ 27,952 | $ 30,900 |
Equity in loss of affiliate | (14) | (231) | ||
Operating segment | Project Management | ||||
Operating Profit | ||||
Operating Income Loss Before Attributable to Affiliate | 15,438 | 12,960 | 43,268 | 42,069 |
Equity in loss of affiliate | (14) | (231) | ||
Project Management | 15,424 | 12,960 | 43,037 | 42,069 |
Operating segment | Construction Claims | ||||
Operating Profit | ||||
Operating Profit | 4,582 | 5,269 | 11,687 | 10,941 |
Corporate | ||||
Operating Profit | ||||
Operating Profit | $ (8,313) | $ (6,932) | $ (26,772) | $ (22,110) |
Business Segment Information 60
Business Segment Information (Details 3) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Depreciation and Amortization Expense | ||||
Depreciation and amortization expenses | $ 2,863 | $ 2,412 | $ 8,286 | $ 7,276 |
Operating segment | ||||
Depreciation and Amortization Expense | ||||
Depreciation and amortization expenses | 2,711 | 2,358 | 7,986 | 7,114 |
Operating segment | Project Management | ||||
Depreciation and Amortization Expense | ||||
Depreciation and amortization expenses | 1,924 | 1,718 | 5,637 | 5,137 |
Operating segment | Construction Claims | ||||
Depreciation and Amortization Expense | ||||
Depreciation and amortization expenses | 787 | 640 | 2,349 | 1,977 |
Corporate | ||||
Depreciation and Amortization Expense | ||||
Depreciation and amortization expenses | $ 152 | $ 54 | $ 300 | $ 162 |
Business Segment Information 61
Business Segment Information (Details 4) | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015USD ($)country | Sep. 30, 2014USD ($)country | Sep. 30, 2015USD ($)country | Sep. 30, 2014USD ($)country | |
Consulting Fee Revenue by Geographic Region | ||||
Consulting Fee Revenue | $ 158,579,000 | $ 145,324,000 | $ 469,458,000 | $ 427,088,000 |
Consulting fee revenue (as a percent) | 100.00% | 100.00% | 100.00% | 100.00% |
Total Revenue | $ 178,935,000 | $ 161,491,000 | $ 530,851,000 | $ 471,143,000 |
Total revenue (as a percent) | 100.00% | 100.00% | 100.00% | 100.00% |
U.S./Canada | ||||
Consulting Fee Revenue by Geographic Region | ||||
Consulting Fee Revenue | $ 38,569,000 | $ 32,228,000 | $ 113,735,000 | $ 93,227,000 |
Consulting fee revenue (as a percent) | 24.30% | 22.20% | 24.20% | 21.80% |
Total Revenue | $ 53,554,000 | $ 43,804,000 | $ 159,169,000 | $ 122,127,000 |
Total revenue (as a percent) | 29.90% | 27.10% | 30.00% | 25.90% |
Latin America | ||||
Consulting Fee Revenue by Geographic Region | ||||
Consulting Fee Revenue | $ 8,347,000 | $ 10,503,000 | $ 23,011,000 | $ 32,315,000 |
Consulting fee revenue (as a percent) | 5.30% | 7.20% | 4.90% | 7.60% |
Total Revenue | $ 8,398,000 | $ 10,535,000 | $ 23,092,000 | $ 32,577,000 |
Total revenue (as a percent) | 4.70% | 6.50% | 4.30% | 6.90% |
Europe | ||||
Consulting Fee Revenue by Geographic Region | ||||
Consulting Fee Revenue | $ 23,476,000 | $ 18,950,000 | $ 64,905,000 | $ 58,337,000 |
Consulting fee revenue (as a percent) | 14.80% | 13.00% | 13.80% | 13.70% |
Total Revenue | $ 24,814,000 | $ 20,266,000 | $ 68,534,000 | $ 62,160,000 |
Total revenue (as a percent) | 13.90% | 12.50% | 12.90% | 13.20% |
Middle East | ||||
Consulting Fee Revenue by Geographic Region | ||||
Consulting Fee Revenue | $ 72,441,000 | $ 68,043,000 | $ 222,572,000 | $ 200,045,000 |
Consulting fee revenue (as a percent) | 45.70% | 46.80% | 47.50% | 46.80% |
Total Revenue | $ 75,320,000 | $ 70,218,000 | $ 231,314,000 | $ 207,691,000 |
Total revenue (as a percent) | 42.10% | 43.50% | 43.60% | 44.10% |
Africa | ||||
Consulting Fee Revenue by Geographic Region | ||||
Consulting Fee Revenue | $ 7,225,000 | $ 5,580,000 | $ 21,329,000 | $ 17,864,000 |
Consulting fee revenue (as a percent) | 4.50% | 3.80% | 4.50% | 4.20% |
Total Revenue | $ 8,205,000 | $ 6,480,000 | $ 24,444,000 | $ 20,576,000 |
Total revenue (as a percent) | 4.60% | 4.00% | 4.60% | 4.40% |
Asia/Pacific | ||||
Consulting Fee Revenue by Geographic Region | ||||
Consulting Fee Revenue | $ 8,521,000 | $ 10,020,000 | $ 23,906,000 | $ 25,300,000 |
Consulting fee revenue (as a percent) | 5.40% | 7.00% | 5.10% | 5.90% |
Total Revenue | $ 8,644,000 | $ 10,188,000 | $ 24,298,000 | $ 26,012,000 |
Total revenue (as a percent) | 4.80% | 6.40% | 4.60% | 5.50% |
U.S. | ||||
Consulting Fee Revenue by Geographic Region | ||||
Consulting Fee Revenue | $ 37,854,000 | $ 31,309,000 | $ 111,436,000 | $ 90,533,000 |
Consulting fee revenue (as a percent) | 23.90% | 21.50% | 23.70% | 21.20% |
Total Revenue | $ 52,774,000 | $ 42,876,000 | $ 156,715,000 | $ 119,378,000 |
Total revenue (as a percent) | 29.50% | 26.60% | 29.50% | 25.30% |
Non - U.S. | ||||
Consulting Fee Revenue by Geographic Region | ||||
Consulting Fee Revenue | $ 120,725,000 | $ 114,015,000 | $ 358,022,000 | $ 336,555,000 |
Consulting fee revenue (as a percent) | 76.10% | 78.50% | 76.30% | 78.80% |
Total Revenue | $ 126,161,000 | $ 118,615,000 | $ 374,136,000 | $ 351,765,000 |
Total revenue (as a percent) | 70.50% | 73.40% | 70.50% | 74.70% |
Non - U.S. | Consulting fee revenue | Geographic concentration risk | ||||
Consulting Fee Revenue by Geographic Region | ||||
Number of countries | country | 0 | 0 | 0 | 0 |
Non - U.S. | Total revenue | Geographic concentration risk | ||||
Consulting Fee Revenue by Geographic Region | ||||
Number of countries | country | 0 | 0 | 0 | 0 |
United Arab Emirates | ||||
Consulting Fee Revenue by Geographic Region | ||||
Consulting Fee Revenue | $ 29,642,000 | $ 18,666,000 | $ 83,613,000 | $ 52,385,000 |
Consulting fee revenue (as a percent) | 18.70% | 12.80% | 17.80% | 12.30% |
Total Revenue | $ 30,910,000 | $ 19,112,000 | $ 85,898,000 | $ 53,352,000 |
Total revenue (as a percent) | 17.30% | 11.80% | 16.20% | 11.30% |
Oman | ||||
Consulting Fee Revenue by Geographic Region | ||||
Consulting Fee Revenue | $ 16,098,000 | $ 50,175,000 | ||
Consulting fee revenue (as a percent) | 11.10% | 11.70% | ||
Total Revenue | $ 16,960,000 | $ 53,773,000 | ||
Total revenue (as a percent) | 10.50% | 11.40% |
Business Segment Information 62
Business Segment Information (Details 5) - USD ($) $ in Thousands | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Consulting Fee Revenue and Total Revenue By Client Type | ||||
Consulting Fee Revenue | $ 158,579 | $ 145,324 | $ 469,458 | $ 427,088 |
Consulting fee revenue (as a percent) | 100.00% | 100.00% | 100.00% | 100.00% |
Total Revenue | $ 178,935 | $ 161,491 | $ 530,851 | $ 471,143 |
Total revenue (as a percent) | 100.00% | 100.00% | 100.00% | 100.00% |
U.S. federal government | ||||
Consulting Fee Revenue and Total Revenue By Client Type | ||||
Consulting Fee Revenue | $ 2,295 | $ 4,562 | $ 7,061 | $ 11,169 |
Consulting fee revenue (as a percent) | 1.40% | 3.10% | 1.50% | 2.60% |
Total Revenue | $ 2,802 | $ 5,894 | $ 8,651 | $ 13,763 |
Total revenue (as a percent) | 1.60% | 3.60% | 1.60% | 2.90% |
U.S. state, regional and local governments | ||||
Consulting Fee Revenue and Total Revenue By Client Type | ||||
Consulting Fee Revenue | $ 21,630 | $ 19,989 | $ 63,921 | $ 55,029 |
Consulting fee revenue (as a percent) | 13.60% | 13.80% | 13.60% | 12.90% |
Total Revenue | $ 34,793 | $ 28,627 | $ 101,402 | $ 74,456 |
Total revenue (as a percent) | 19.40% | 17.70% | 19.10% | 15.80% |
Foreign governments | ||||
Consulting Fee Revenue and Total Revenue By Client Type | ||||
Consulting Fee Revenue | $ 51,136 | $ 54,361 | $ 160,694 | $ 165,325 |
Consulting fee revenue (as a percent) | 32.30% | 37.40% | 34.20% | 38.70% |
Total Revenue | $ 54,578 | $ 57,825 | $ 171,615 | $ 175,490 |
Total revenue (as a percent) | 30.50% | 35.80% | 32.40% | 37.20% |
Private sector | ||||
Consulting Fee Revenue and Total Revenue By Client Type | ||||
Consulting Fee Revenue | $ 83,518 | $ 66,412 | $ 237,782 | $ 195,565 |
Consulting fee revenue (as a percent) | 52.70% | 45.70% | 50.70% | 45.80% |
Total Revenue | $ 86,762 | $ 69,145 | $ 249,183 | $ 207,434 |
Total revenue (as a percent) | 48.50% | 42.90% | 46.90% | 44.10% |
Business Segment Information 63
Business Segment Information (Details 6) - USD ($) $ in Thousands | Sep. 30, 2015 | Dec. 31, 2014 |
Property, Plant and Equipment, Net by Geographic Location | ||
Property, Plant and Equipment, Net by Geographic Location | $ 22,565 | $ 11,643 |
U.S./Canada | ||
Property, Plant and Equipment, Net by Geographic Location | ||
Property, Plant and Equipment, Net by Geographic Location | 12,476 | 3,358 |
Latin America | ||
Property, Plant and Equipment, Net by Geographic Location | ||
Property, Plant and Equipment, Net by Geographic Location | 971 | 1,101 |
Europe | ||
Property, Plant and Equipment, Net by Geographic Location | ||
Property, Plant and Equipment, Net by Geographic Location | 2,850 | 2,191 |
Middle East | ||
Property, Plant and Equipment, Net by Geographic Location | ||
Property, Plant and Equipment, Net by Geographic Location | 4,440 | 3,428 |
Africa | ||
Property, Plant and Equipment, Net by Geographic Location | ||
Property, Plant and Equipment, Net by Geographic Location | 988 | 901 |
Asia/Pacific | ||
Property, Plant and Equipment, Net by Geographic Location | ||
Property, Plant and Equipment, Net by Geographic Location | 840 | 664 |
U.S. | ||
Property, Plant and Equipment, Net by Geographic Location | ||
Property, Plant and Equipment, Net by Geographic Location | 12,476 | 3,358 |
Non - U.S. | ||
Property, Plant and Equipment, Net by Geographic Location | ||
Property, Plant and Equipment, Net by Geographic Location | $ 10,089 | $ 8,285 |
Client Concentrations (Details)
Client Concentrations (Details) - client | 3 Months Ended | 9 Months Ended | ||
Sep. 30, 2015 | Sep. 30, 2014 | Sep. 30, 2015 | Sep. 30, 2014 | |
Consulting fee revenue | Customer concentration | Oman | ||||
Concentrations of Credit Risk | ||||
Number of clients | 1 | 1 | ||
Percentage of concentration risk | 10.40% | 11.10% | ||
Consulting fee revenue | Contracts with U.S. federal government agencies | ||||
Concentrations of Credit Risk | ||||
Percentage of concentration risk | 1.40% | 3.10% | 1.50% | 2.60% |
Total revenue | Customer concentration | Oman | ||||
Concentrations of Credit Risk | ||||
Number of clients | 1 | |||
Percentage of concentration risk | 10.10% | |||
Total revenue | Contracts with U.S. federal government agencies | ||||
Concentrations of Credit Risk | ||||
Percentage of concentration risk | 1.60% | 3.60% | 1.60% | 2.90% |
Commitments and Contingencies (
Commitments and Contingencies (Details) | Oct. 31, 2015GBP (£) | Oct. 31, 2015USD ($) | Oct. 05, 2015USD ($) | Jun. 15, 2015AED | Jun. 15, 2015USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2015USD ($) | Sep. 30, 2015GBP (£) | Sep. 30, 2015USD ($) | Apr. 30, 2015BRL |
ESA | ||||||||||
Acquisition-Related Contingencies | ||||||||||
Ownership interest acquired (as a percent) | 91.00% | 91.00% | ||||||||
Contingent consideration | $ 3,416,000 | BRL 10,645,000 | ||||||||
Cadogans | ||||||||||
Acquisition-Related Contingencies | ||||||||||
Acquisition consideration payable | £ | £ 600,000 | |||||||||
Amount of cash paid to acquire the entity | 579,000 | $ 894,000 | ||||||||
Net assets | £ | £ 1,000,000 | |||||||||
Contingent consideration arrangement, evaluation period | 2 years | |||||||||
Contingent consideration, minimum | £ | £ 0 | |||||||||
Contingent consideration | £ | £ 200,000 | |||||||||
Plaintiff | ||||||||||
Acquisition-Related Contingencies | ||||||||||
Possible loss contingency | $ 8,771,000 | |||||||||
Settlement amount | $ 2,596,000 | |||||||||
Interest amount | 1,056,000 | |||||||||
Interest accrued | $ 448,000 | |||||||||
Interest amount charged to expense | $ 608,000 | $ 608,000 | ||||||||
Plaintiff | Former executive | ||||||||||
Acquisition-Related Contingencies | ||||||||||
Possible loss contingency | AED | AED 4,536,239 | |||||||||
Settlement amount | AED 750,000 | $ 200,000 | ||||||||
Additional settlement payment | 100,000 | |||||||||
Legal costs | $ 834,000 | |||||||||
Hill Spain | ESA | ||||||||||
Acquisition-Related Contingencies | ||||||||||
Ownership interest acquired (as a percent) | 91.00% | 91.00% | ||||||||
Multiple of earnings for determining purchase price of minority shares | 7 | 7 | ||||||||
Call option Purchase price premium if exercised by Gerens Hill (as a percent) | 5.00% | |||||||||
Call/put option exercise period after audited financial statements | 3 months |
Other Matters (Details)
Other Matters (Details) | 9 Months Ended | ||
Sep. 30, 2015USD ($)employee | Apr. 02, 2015USD ($) | Dec. 31, 2014USD ($) | |
Grant received | $ 1,000,000 | ||
Minimum capital expenditure required to be made to receive grant | $ 6,425,000 | ||
Minimum term of lease | 7 years | ||
Minimum persons to be employed | employee | 359 | ||
Term of lease | 12 years | ||
Loan | $ 143,474,000 | $ 128,236,000 | |
Tenant improvement allowance from landlord | $ 3,894,000 | ||
Amortization period for tenant improvements | 12 years | ||
Commonwealth of Pennsylvania | Maximum | |||
Tax credits | $ 666,000 | ||
City of Philadelphia | Maximum | |||
Tax credits | 1,150,000 | ||
Loans | PIDC | |||
Loan | 723,000 | $ 750,000 | |
Loans payable with certain conditions | PIDC | |||
Loan | $ 345,000 |
Subsequent Event (Details)
Subsequent Event (Details) | Nov. 03, 2015USD ($) |
Subsequent event | Secured Credit Facilities | |
Subsequent event | |
Waiver fees and out-of-pocket expenses | $ 81,900 |